Gnolls are the big, nasty, hairy and cute villains that have become one of the staple D&D monster races - they rank wayyy up there among orcs, goblins and kobolds in the list of Most Chopped-Up Cannon Fodder of the Evil Overlords (though it must be noted gnolls don't typically make good mercenaries).
Gnolls are basically bipedal anthropomorphic hyenas, on average 7.5 feet tall. Some postulate they were a result of an unsuccesful magical experiment of merging gnomes and trolls ages ago, but this doesn't sound credible.
While your typical gnoll is not particularly smart, they're very instinctual, strong and capable fighters, and in numbers they're definitely a force to be feared. They are typically only concerned about Getting More Food (and that means meat). Like most of the medium-size and smaller humanoids, they rely on attacking in numbers, though they typically lack any subtlety in their tactics - but they are still pretty good at setting up ambushes. Gnolls live in packs that may have hundreds of individuals, and typically settle in burrows and caverns.
Most gnolls worship Yeenoghu, a demon lord that looks like a gaunt gnoll (depending on the situation).
The joy was great and the celebration was big when gnolls were added to Neverwinter Nights in the 1.28 patch. Gnolls rule.
Aaron Allison. Dungeons & Dragons Rules Cyclopedia, 1991. TSR Inc., 1991. ISBN 1-56076-075-0.
Monte Cook, Jonathan Tweet and Skip Williams. Monster Manual, Core Rulebook III, Dungeons & Dragons 3rd Edition, 10/2000. Wizards of the Coast, 10/2000. ISBN 0-7869-1552-8.
Matthew Sprange. The Slayer's Guide to Gnolls, 2001. Mongoose Publishing, 2001. ISBN 1-903980-01-1.