Developed countries are in a transition into service societies. In the past few years, there has been a significant rise in Internet services in people's everyday lives. With the rise of the phenomenon called Web 2.0, users of the services are starting to experience new types of dynamically evolving services. New services enable user-created content and social awareness, and they are often dynamically composed of various service "mashup" components. Even though there are numerous success stories of such services, coherent design principles of user experience of these services are only starting to emerge. One significant aspect that affects the user-centered design of Web 2.0 services is the dynamic nature of service development, with the requirement of fast and continuous iteration of the services. In this chapter, we first explore the nature of Web 2.0 services from the users' perspective. We then review the multidisciplinary nature of experience, service experience, and user experience, and summarize the essential elements of the service user experience (SUX). We then investigate the applicability of user-centered design principles to the service development life cycle and discuss users' new roles in service development. We present a summary of SUX design opportunities and challenges. Our main conclusions are that new, agile methods to involve users in the service development process need to be developed, and that less technically advanced users should be involved in co-creation of Web 2.0 services.