Warnings From Google about using the Disavow tool to disavow backlinks
"This is an advanced feature and should only be used with caution. If used incorrectly, this feature can potentially harm your site’s performance in Google’s search results. We recommend that you disavow backlinks only if you believe you have a considerable number of spammy, artificial, or low-quality links pointing to your site, and if you are confident that the links are causing issues for you."
- Google Webmaster Tools Disavow Links page
More information from Google Engineers:
Disavow Links Video - Matt Cutts (Google Engineer) explains the "Disavow links" feature of Google Webmaster Tools.
Video Webmaster Office-hours April 26, 2013 - John Mueller (Google Engineer) talking about the Google Disavow tool
Code:
http://backlinks.webmasterworld.com/google-backlink-tool-penguin-disavow/