When someone is blacklisted (or blackballed), it means that he or she is put on a list of individuals and organizations which have been singled out as deserving of some sort of denial or punishment, with the assumption that they deserve such treatment because of their behavior. For example, in some industries, blacklisting of bad employees is common, and once an employee is blacklisted, it is impossible to find employment in that industry. The legality of the action varies, depending on the situation; in some cases it is perfectly acceptable, whereas in other instances, it is viewed as discrimination.
The origins of the blacklist lie in the merchant community. Historically, when people became bankrupt, they were added to a list kept by neighborhood merchants, who would deny credit and services to bankrupts. Sometimes such lists were publicly posted, adding to the shame and humiliation of bankruptcy. This list came to be known colloquially as a blacklist, and over time the concept spread more generally to include any sort of list of proscribed individuals.
Blacklists are used to deny entrance to social clubs, restaurants, performance venues, stores, and other facilities, often with the justification that people are blackballed for illegal activity or causing trouble. Since private businesses retain the right to refuse service in many regions of the world, this type of list is not illegal, although a list which included a large number of people from a particular social, ethnic, or religious group could raise eyebrows.
Employee blacklisting is of more ambiguous legality. In some cases, someone is blackballed due to discriminatory practices, as most notably happened with the Hollywood Blacklist of the 1950s. In these cases, the employee could have grounds for a lawsuit. Often, such lists are informal rather than explicit, created through exchanges of information between people in the industry so that it is more difficult to prove that such a list really does exist.
Blackballing for financial reasons is also legal, on the same grounds that businesses can refuse services. Someone who writes bad checks, for example, could be blackballed from a store, and in some communities, store owners exchange information with each other, creating a list which covers all of the questionable people in the community. Services at banks and other financial institutions can also be denied to people on a blacklist, as long as the organization can prove that the financial circumstances of the person in question are grounds for denial of services.