Preparing to add some location-based sparkle to its Timeline feature?
The story was first reported by CNNMoney, which quotes unnamed sources who say that the deal is done and that it's a perfect fit.
Since then, an email from Gowalla founder Josh Williams has emerged, which denies the deal but implies strongly that it's in the process of going through.
Gowalla was launched in 2009, and rode high in those early heady says when SXSW went crazy for check-in services.
However, it quickly fell behind its direct rival Foursquare, and thereafter switched strategies a few times and moved more towards city guides.
Reports says that, within Facebook, the Gowalla team would work on fine-tuning the recently unveiled Timeline feature. This lets users keep a record of their most significant photos, events, and other memories in one stream.