The company, which launched its flat fee service in June, last week targeted those users it felt were abusing the system by staying connected to the internet for an average of more than 16 hours a day.
The offending customers were told they were in breach of contract and were given a few weeks in which to modify their use of the internet, failing which their access would be terminated.
A clause contained in the terms and conditions signed by Freeserve customers says that misuse of the service includes: "Using it in a manner, which, in our opinion, makes abnormal demands on the network from a single connection".
The company is hardly the first ISP to experience difficulties when offering unlimited access to the internet for a set rate. In August, AltaVista withdrew its offer before it had connected any customers because of the cost, while in July, Breathe.com cut off its heaviest 'unmetered access' users to protect the quality of service received by the rest of its customer base.
Freeserve said a minority of its customers had been using the service for business purposes 24 hours a day, and suggested they switch instead to its 'always connected' ADSL service.