A term used to describe censorship that is caused when someone is afraid of creating or posting content because of potential legal threats. This effect is often encountered when a company or individual does not post copyright information or has a vague copyright information and/or when you receive a legal notice such as a cease and desist letter and are uncertain about your rights.
A great site that contains extensive information and examples of the chilling effect can be found at: http://www.chillingeffects.org/