Yes, but you can go to your settings and set a language filter.
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While the language filter will filter out most of the swear words, be warned that swearing is still against the Terms of Use for World of Warcraft and is therefore ban-able if someone decides to report your use of swear words. It will usually start as a temporary ban (3 hours or so) and work its way up the "penalty volcano" until your swearing can get you a permanent ban of your account.
Long story short: You can swear, but you might be banned for it.
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