I moved to Tn from Ohio about 3 years ago. I have family that lives here. I got remarried when i moved here. My husbands mother,(my mother n law) does not like me,because she knows of some of my family. My mother n law has been going around telling other people including her family, that I steal from her grand daughter(my 5 year old step daughter) that I do drugs, that i am using my husband for money(he has been laid off of work for almost a year now) that I am a drunk,(I do drink on my birthday and new years if i do not have my kids), she has made false statements about my 12 year old daughters medication(she as adhd) to family members, so now my daughter is getting picked on at school,because of my husbands younger family members go to school with my daughter and harassing us on the net
Personal Injury Lawyer
Inter-family squabbles and dischord make for the most difficult and often unsuccessful defamation lawsuits to prosecute, and are still expensive to pursue. Statements made in the form of opinions, as compared to statements of fact only are not actionable, although arguably you present both types [calling you a drunk = opinion; saying you stole = fact]. It would seem that you should have your husband speak with his mother to bring this bickering to an end. You can also try to hire an attorney to send your mother a Cease and Desist letter, in the hopes that will reign ner in without the need for further consideration about a lawsuit - where all the "dirty laundry" will be aired.
You're not going to improve your family life by bringing a lawsuit.
I suggest you consider meeting with a family therapist to assist you in coping with this difficult situation and get pointers on how to deal with this difficult and untruthful woman.
This response does not constitute legal advice and does not create an attorney-client relationship. Due to the complexity and ever-changing nature of the law and to the limitations of this forum, this information may not be adequate for your specific situation.