Today, Facebook announced XMPP support for Facebook Chat. This is big news, as this means that all XMPP enabled chat clients (including Pidgin) can now connect to Facebook with merely a few simple steps.
Doing so in Pidgin is quick and easy. To start, go to the add accounts menu. When adding an account, you should select the following values:
For the protocol type, select XMPP.
For the username, use your Facebook username. (see http://www.facebook.com/username/)
For the domain, use "chat.facebook.com"
For the password, use your Facebook password.
In advanced, do the following:
Uncheck Require SSL
Set connect port to 5222
Set connect server to chat.facebook.com
That's it! Hit save and you will be logged into Facebook chat.
For those of you who currently use the third party Facebook plugin, we strongly encourage you to switch to using the official Facebook XMPP protocol. The plugin is rife with minor problems and bugs due to how it attempts to use a number of undocumented protocols. Conversely, the XMPP implementation is official and fully supported, and will be far superior in the long run.
You can read the official Facebook blog post at http://developers.facebook.com/news.php?blog=1&story=361
(Post edited to include necessary advanced settings)