TikTok has agreed to pay $92m (£66m) to settle a lawsuit accusing it of misusing artificial intelligence to track and store users' data.
A group challenge alleged it breached laws by using software to recognise facial features in user videos and algorithms to identify age, gender and ethnicity.
It also alleged that user data was sent to China.
TikTok denied any wrongdoing but said it wanted to avoid a court case.
The case alleged that facial-recognition data collected by TikTok was used to track and profile users for the purpose of ad targeting, among other things.
TikTok said in a statement: "While we disagree with the assertions, rather than go through lengthy litigation, we'd like to focus our efforts on building a safe and joyful experience for the TikTok community."
If the settlement is agreed by a federal judge, the money will be divided up among US-based TikTok users. The case was heard in Illinois, which has strict laws around the use of biometrics.
Ray Walsh, a digital-privacy expert at virtual private network provider ProPrivacy said; "That TikTok has opted to pay such a massive settlement in this privacy case suggests it knows it would not win.
"It is obvious that TikTok has the money to fight the case and yet it is choosing to pay a huge sum in order to make the case go away. The app's Chinese owner, ByteDance, obviously feels it is better off cutting its losses... than gaining more bad press further down the line."
ByteDance has faced similar claims before and in 2019 settled another case about violating the privacy of its young users.
But it has strenuously denied that it sends any US data to China - one of the allegations from the former Trump administration when it sought to ban TikTok in the US over security concerns.
That move is currently in abeyance.