Stopping mail relaying

Hello.

I have an Exchange 5.5 mail server. I noticed that a user of my domain can spoof its email address and send an mail to another user using a fake email address in the SENDER FIELD.

Does it mean that my server is a mail relay?
How can I stop this spoofing problem?
If you can supply me with some web links that describe how to prevent mail relaying in Exchange 5.5. it would be great.

Thank you in advance.

Stergios