The fact is that employers are looking online to find out more about potential employees these days. Not for every job but for the ones they consider important or for when they have two people that they are considering hiring but can't decide between the two.
So, yes, employers might look at your Facebook profile if it is publicly accessible. And yes, they may not hire you based on what they find there. Do you talk about the wild parties you went to? Have pictures of you an your buddies drinking? Have any drug references? Blab about how you hate your job and your boss is a *&((^? These are some of the reasons why you might not get the job. But you can protect your Facebook profile very easily - in fact - I wrote a post about it so go read up on protecting your Facebook profile.
They may also check out your Twitter feed. If you tweet about any of the above mentioned things you should either use a completely different name (not your real name) or you should lock your Twitter feed so that only people you allow to follow you can do so. You should also keep in mind who you are following, what you are re-tweeting, and links you are sharing as these may all influence their decision.
What else might they check? They might check to see if you have a blog, a YouTube account, social bookmarking sites (like Digg, StumbleUpon, etc), or forums you belong to. If you are using your real name anywhere online - they can find it.
Want to know what is showing up online when someone searches for you? You can do a google search be searching for you name in quotes or with your town associated with it. You can also use one of the many online tools that can help you discover what social media has to say about you.