I still think that for the most part Wikipedia is credible but a recent highly-publicized story was an embarrassment for the free online encyclopedia:
In May 2005, an anonymous user created a Wikipedia article for the respected journalist John Seigenthaler Sr. which claimed that he was involved in the assassinations of Robert and John Kennedy. This version of the article was active until September, when Seigenthaler found out about the malicious act. He called the Wikipedia founder Jimmy Wales and the content was immediately deleted. The Wikipedia editors created a new entry which is now protected.
The incident prompted Seigenthaler to write in Op-Ed for USA Today that "Wikipedia is a flawed and irresponsible research tool...for four months, it depicted me as a suspected assassin."
On December 5, Seigenthaler appeared on CNN with Wikipedia founder Jimmy Wales to discuss the problem (you can watch the 10-minute video on CNN website).
To prevent similar occurrences in the future, Wikipedia will now require users to register before they can create an article. The largest encyclopedia in the world was launched in 2001 and currently has 850,000 articles in English. The servers are based in St. Petersburg, Florida.
As long as the Wikipedia can keep the vandals out or have the editors/contributors correct the erroneous entries, it will continue to be a valuable tool.
Disclaimer: I am also a registered contributor to Wikipedia.
A man in Nashville has admitted that he put false information into a Wikipedia entry about John Seigenthaler Sr. Read more in A Little Sleuthing Unmasks Writer of Wikipedia Prank - NYTimes.
In conclusion, Wikipedia now has an article about the whole John Seigenthaler Sr. Wikipedia Biography Controversy.
Online encyclopedia tightens rules - CNN
A false Wikipedia 'biography' - USA Today
Wikipedia tightens online rules - BBC
Wikipedia Changes a Policy - Google Blogoscoped
Wikipedia to Require Contributors to Register - NPR
Make the Largest Encyclopedia in the World Better. I already did (I hope)
Jimmy Wales: A public talk on Wikipedia at ibiblio.com - download video of the lecture
Some of the text of this post is based on Wikipedia
Image source: Wikipedia