Should I avoid using "text-align: justify;"?

Firstly, this is purely a design-related problem and solution. The design of your grid specifies if justifying text is needed. I think justify align alone has no major effect on usability. Bad typography that makes text illegible is what decreases usability. That said, make sure you have solid contrasts and a good balance of spacing in your type. Font-size matters too.

This site is a successful attempt at justifying text online. Since you can't control the spaces between letters and words nearly as much with CSS as you can with InDesign, it's a lot harder to justify text and not have 'rivers' of whitespace run down your rows, which happens when the spaces between words exceeds the spaces between lines. Things that make justifying text difficult: long words, row widths that don't hold enough words, and too much contrast between the text and the background colors; they make the rivers appear wider and more apparent.

The typographic ideal is to have an even text-block, where if you squint the text block becomes a uniform solid shade. So if you keep text at about 10px and 60% gray on white background, and have rows that fit about 20 words, justify align shouldn't look ugly. But keep in mind this does nothing to improve usability. Small, relatively light text annoys a lot of people, especially the older readers.

I should note that with ­ (soft hyphenation) correctly separating long troublesome words like super­awesome you can mimic proper typesetting (e.g. InDesign). There's a lot of stuff out there to help you do this. I would recommend the logic for hiding, manipulating, and displaying the text to be done on the client side, perhaps with this.

Edit: As others mention below, css hyphens are possible now, except not feasible (not in Chrome). Plus, css4 offers even more control.

text-align: justify shouldn't be used in browsers at the moment. They aren't good at handling the minute details within and the output ends up containing lots of rivers and there's no support for hyphenation (other than soft hyphens).

Note above was written 4.5 years ago. Things are slowly changing... http://caniuse.com/#feat=css-hyphens

Edit: Hyphenator was brought to my attention in this answer's comments. It looks like it makes text-align justify worth using, check out the sites that use it. You may want to use javascript to apply text-align justify before using this script so that those without javascript don't get caught out.

Edit 2: CSS now allows for hyphenation with the hyphens property [browser support]. PPK is now saying to add it to your stylesheets, whilst Eric Meyer says just add it for mobile.

Edit 3: A good little overview of things available to us now, with some SASS.

The problems brought up by others about justify alignment are more prevalent with narrow columns. If your columns are wide enough in relation to the size of your fonts and other parameters then it's ok to justify the text. Let's say you'd want a minimum of 12 to 15 words per line in average. More is better.

There's no technical reason not to - it's purely a design decision. Many people find that justified text is harder to read, but I guess it depends on your situation. Though it works fine for print, generally web browsers do not give enough control over the eventual output of text to guarantee that what you're serving won't look like crap on some people's screens.

Your best option is to avoid justification.

I cant think of a compelling reason why not to justify text - at a certain point the volume and width of content almost demand that it be justified. Of course, you'll get issues with content consisting of certain word combinations, but to my mind if you're seeing rivers and unusually large spaces between words you have a different problem altogether - one of readability and clarity.

What I would avoid, at all costs, is centered body text. I don't think there's a greater red flag of ammateurish web design than that.