If you decide that the rumor is hurtful in some way, make a stand. Decide that you don't want to take part in spreading it. Others may continue to circulate the gossip, but you've made a personal choice to stay out of it. Chances are that the rumor will die out much more quickly than if you had joined the buzz.
Don't be an audience
When someone comes to you with a rumor, try not to be an audience. This person may want to hurt somebody, or may be after attention or power. It can be hard to resist hearing some juicy dish, especially if you're bored, but make an effort to say, "I'm not interested in hearing mean gossip, thanks."
Just like with physical bullying, there are no "innocent bystanders" with hurtful rumors. Hearing and reacting to the rumor, and letting it continue, makes you almost as responsible for its damage as the person who started it. Instead, don't provide another pair of ears for the rumor-starter. If he isn't getting the reaction or attention he's seeking, he'll be less likely to do it in the future.
Be a peacemaker
If one of your friends wants to hurt someone else by spreading lies or rumors, speak up. Let your friend know that this isn't the right thing to do. If you need to, find another friend who feels the same way and talk to the others together. If rumors are getting out of control and someone is being made a real victim, get a counselor or teacher involved.
Respect others' privacy
If you don't want other people talking about the personal things in your life, don't do it to others. When you hear personal information about a classmate or friend, try to keep it to yourself, and don't worry about whether it's true or not. If you respect people's privacy, they'll be more likely to do the same for you.
Most of the time, you should try to ignore gossip and rumors. But if you hear a rumor about something important, and it doesn't sound too crazy or far-fetched, ask a teacher, guardian, or parent what they think. If it's a modern legend that you find interesting, you can try searching on the Web to see if it's been proven fake or not. But remember not to believe everything you read, even on the Web!
Then we have the form of gossip that turns into SLANDER!