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Instagram is an online photo-sharing, video-sharing and social networking service that enables its users to take pictures and videos, apply digital filters to them, and share them on a variety of social networking services, such as Facebook, Twitter, Tumblr and Flickr. A distinctive feature is that it confines photos to a square shape, similar to Kodak Instamatic and Polaroid images, in contrast to the 16:9 aspect ratio now typically used by mobile device cameras. Users are also able to record and share short videos lasting for up to 15 seconds. Instagram was created by Kevin Systrom and Mike Krieger and launched in October 2010.

The service rapidly gained popularity, with over 100 million active users as of April 2012. Instagram is distributed through the Apple App Store, Google Play, and Windows Phone Store. Support was originally available for only the iPhone, iPad, and iPod Touch; in April 2012, support was added for Android camera phones. Third-party Instagram apps are available for Blackberry and Nokia-Symbian Devices. On October 22, 2013, during the Nokia World at Abu Dhabi, UAE, Kevin Systrom has confirmed that official Instagram app for Windows Phone will be available in the coming weeks. On November 21, 2013, the official Instagram Beta for Windows Phone has been released to Windows Phone 8 to allow Windows Phone user to get faster access to Instagram services although the app is still under development with lack of video recording and capture image through app. The service was acquired by Facebook in April 2012 for approximately US$1 billion in cash and stock.

In 2013, Instagram grew by 23%, while Facebook, as the mother company, only grew by 3%. Instagram began development in San Francisco when Kevin Systrom and Brazilian Michel "Mike" Krieger chose to focus their multi-featured HTML5 check-in project Burbn on mobile photography. The name "Instagram" is a portmanteau of "instant camera" and "telegram". On March 5, 2010, Systrom closed a $500,000 seed funding round from Baseline Ventures and Andreessen Horowitz while working on Burbn. Josh Riedel joined the company as Community Manager. Shayne Sweeney joined in November 2010 as an engineer and Jessica Zollman was hired as a Community Evangelist in August 2011. In January 2011, Instagram added hashtags to help users discover both photographs and each other. Instagram encourages users to make tags both specific and relevant, rather than tagging generic words like "photo" in order to make photographs stand out and to attract like-minded Instagrammers. In September, version 2.0 went live in the App Store (iOS).

It included new and live filters, instant tilt–shift, high resolution photographs, optional borders, one click rotation and an updated icon. On February 2, 2011, it was announced that Instagram had raised $7 million in Series A funding from a variety of investors, including Benchmark Capital, Jack Dorsey, Chris Sacca (through Capital fund), and Adam D'Angelo. The deal valued Instagram at around $25 million. On April 3, 2012, Instagram for Android phones running the 2.2 Froyo version of the OS was released and it was downloaded more than one million times in less than one day. That same week, Instagram raised $50 million from venture capitalists for a share of the company; the process valued Instagram at $500 million. In the next three months Instagram was rated more than one million times on Google Play and was the fifth app ever to reach one million ratings on Google Play—as of April 2013, it had been rated nearly four million times.

In its largest acquisition deal to date, Facebook made an offer to purchase Instagram (with its 13 employees) for approximately $1 billion in cash and stock in April 2012 with plans to keep the service independently managed. Britain's Office of Fair Trading approved the deal on August 14, 2012 and on August 22, 2012, the Federal Trade Commission in the United States closed its investigation, allowing the deal to proceed. On September 6, 2012, the deal between Instagram and Facebook officially closed. On April 12, 2012, Facebook acquired Instagram for approximately $1 billion in cash and stock. The deal, which was made just before Facebook was scheduled to go public, cost Facebook about a quarter of the cash-on-hand they had as of the end of 2011. The deal was for a company characterized as having "lots of buzz but no business model", and the price was contrasted with the $35 million Yahoo! paid for Flickr in 2005 a website which has since become among the 50 most popular in the world. Mark Zuckerberg noted that Facebook was "committed to building and growing Instagram independently", in contrast to its common practice of, as CNNMoney.com put it, buying "hot startups, killing their products, and redeploying their staff on other projects." According to multiple reports, the deal netted Instagram CEO Kevin Systrom $400 million based on his ownership stake in the business. The exact purchase price was $300 million in cash and 23 million shares of stock. On December 17, 2012, Instagram updated its Terms of Service, granting itself the right to sell users' photos to third parties without notification or compensation starting on January 16, 2013. The criticism from privacy advocates, consumers, National Geographic and celebrities like Kim Kardashian prompted Instagram to issue a statement retracting the controversial terms; regardless, the issue caused Instagram to lose a portion of its user-base as former users switched to other Instagram-like services.

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