Instagram was only launched in October 2010 - initially just for the iPhone before being offered as an Android app last week. The app is free and allows users to apply 17 filters to the pictures they take - changing the colour balance to give the images a different feel - before they are uploaded. It has proven hugely popular. The firm says that it has more than 30 million users uploading more than 5 million new pictures every day.
"We think the fact that Instagram is connected to other services beyond Facebook is an important part of the experience," Mr Zuckerberg wrote on his Facebook page.
"We plan on keeping features like the ability to post to other social networks, the ability to not share your Instagrams on Facebook if you want, and the ability to have followers and follow people separately from your friends on Facebook."
This is the first time Facebook has acquired a company or product with so many users. “We don’t plan on doing many more of these, if any at all.” Zuckerberg said.