Facebook has announced it is now earning more money than it is spending and has signed up its 300 millionth member.

Facebook co-founder and chief executive Mark Zuckerberg said the fast-growing social network had become 'cash flow positive' last quarter, meaning that it is now earning enough to cover operating costs.

"Earlier this year, we said we expected to be cash flow positive sometime in 2010 and I'm pleased to share that we achieved this milestone last quarter," Mr Zuckerberg said in a blog post.

"This is important to us because it sets Facebook up to be a strong independent service for the long-term."

Facebook's announcement is significant in that the Palo Alto, California company, unlike other Web giants such as Amazon, eBay, Google and Yahoo!, had yet to prove how it would translate traffic growth into cash.

Mr Zuckerberg, who created Facebook with two Harvard University room mates five years ago, did not provide any financial details but the company is believed to pull in hundreds of millions of dollars a year from advertising.

The chief executive also announced that "as of today, Facebook now serves 300 million people across the world."

Facebook signed up its 200 millionth user in April.

US software giant Microsoft bought a 1.6 per cent stake in Facebook in 2007 for $US240 million ($278 million), valuing the social network on paper at $US15 billion.

A Russian Internet company invested $US200 million in a nearly 2 per cent stake in Facebook in May in a deal that valued the social networking giant at $US10 billion.

- AFP