urban legend

from WordNet (r) 3.0 (2006)

urban legend
    n 1: a story that appears mysteriously and spreads spontaneously
         in various forms and is usually false; contains elements of
         humor or horror and is popularly believed to be true

from The Free On-line Dictionary of Computing (8 July 2008)

urban legend

   <publication> A story, which may have started with a grain of
   truth, that has been embroidered and retold until it has
   passed into the realm of myth.  It is an interesting
   phenomenon that these stories get spread so far, so fast and
   so often.  Urban legends never die, they just end up on the
   {Internet}!  Some legends that periodically make their rounds
   include "The Infamous Modem Tax", "Craig Shergold/Brain
   Tumor/Get Well Cards", and "The $250 Cookie Recipe".

   (1996-05-08)