OH NO! PAGE NOT FOUND! THE WORLD IS ENDING. Nope. Somebody just clicked on/typed a bad link. And it ended up on Google. So is Google going to punish you for it? Is google furious that your content disappeared?
Nope. Google’s perspective is that it happens to everyone. They officially state that 404s are completely OK. Why is it OK? As the web grows, old stuff is deleted and new stuff comes, but links are forever (or at least a while) and Googlebots can’t tell it’s gone.
So just make sure you’re using real 404s and not a soft 404. While it may seem helpful to use another form of code to help your users find content, Google says that only 404s and 410s should be used for missing content. For content that was moved, use a 310 so that your users are redirected and get what they want. But 404s are ugly! They don’t have to be. See a few examples of funny, or helpful 404s that can endear your readership instead of alienating them in the photo gallery.