Wikipedia has become one of the dominant pillars of the internet and a shining success of knowledge. And on Wikipedia, "Citation Needed" makes sense - because they're trying to build an encyclopedia with references.

Some people don't seem to get that the entire world isn't an encyclopedia.

When you're having a discussion somewhere online, replying to something you dislike with "Citation Needed" is usually counterproductive to good discussion.

Yes, sometimes citation is needed. Especially if something seems off. But here's some guidelines to not looking stupid when you're having a discussion -

1. Do at least one Google search before saying "citation needed" - if there's clear support on your first google search, it's a fact you don't know, not some craziness from your discussion opponent.

2. Ask yourself, "Am I only applying the citation scrutiny because I dislike the point the other person is making?" Citation-needed can be a pretty passive aggressive way to disagree. It implies that the person speaking doesn't know what they're talking about. But, even if that's the case, then...

3. The more polite thing to do is express why you're curious on sources. Something like, "My experience doesn't match that, is that really how it is?" Or, "I've read the opposite... do you have any stats on this?" Or, "That doesn't sound right. Do you have a cite?" That promotes discussion. Unless you really do think they're crazy, in which case...

4. Just grow a set of balls and disagree. If you think they're wrong, just say they're wrong. Maybe link to a source. Or just state your opinion.

"Citation Needed" says "Go spend 10 minutes getting me sources before I'll bother to engage you." If someone sounds totally wrong, just say you disagree and what the facts are. If you don't know, Google it. If you don't see anything, say that and then ask where they got their source.

This same thing applies to, "How can you say that without backing it up with facts?" and other variations. At least, at the very least, please do one google search. Your discussions will improve, and the internet will thank you.

See also: Eliezer Yudkowksky's "Motivated Cognition" and Paul Graham's "How to Disagree."