Used to insult someone,often used in online games or the internet, it is often used when asking someone to do something and they refuse, you then say "you fagzoid" its a more friendly term of "fag" which is a very derogitarty thing to say to someone.
Letters are often changed into numbers following the rules of LEETSPEAK.
Callum- "play zombies on PS3?"
Liam- "No im busy, maybe later!"
Callum- "You fagzoid"
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