404 error

404 responses themselves do not trigger a site-wide penalty. @atop420’s instinct is fine: search engines expect some missing pages. Broken links hurt user experience and can waste crawl resources as @sdollar4321 noted, so they merit repair. Google will report crawl errors in Search Console (as @sharmasathya86 mentioned); those reports are diagnostic and reflect URL state rather than a punitive ranking drop. See Google's guidance on removed content for details. Return a 404 or 410 for removed content

A friendly, useful 404 page is good practice, but the server must still return the proper HTTP status. For Apache an ErrorDocument directive is enough:

ErrorDocument 404 /404.html

For dynamic apps send a 404 header before rendering the template (example in PHP):

<?php
http_response_code(404);
include '404.php';
exit;
?>

Avoid redirecting all missing URLs to the homepage or returning 200 with a “not found” message — that is treated as a soft 404 and loses the signal that a page is genuinely gone. Soft 404s

Practical steps: monitor Search Console and server logs, fix internal broken links, restore or 301-redirect high-value inbound URLs to relevant pages, and use 410 when content is permanently gone to speed deindexing. For large sites, reducing frequent 404s saves crawl budget and improves user trust.