Kakashi is a Jounin from the Hidden leaf village, and was the sensei of Naruto, Sakura, and Sasuke during the Pre-Shippuuden era. He is known as "The Copy Ninja" all around the world, and it is rumored that he has mastered thousands of jutsu. At first glance you would never guess just how powerful he might be. He's appears very relaxed and sometimes even somewhat slow. He also loves to read his romantic (or is it dirty?) book "Come Come Paradise". However, in this case, appearances can be deceiving. Kakashi is known throughout the world as a formidable adversary and he was an apprentice of the Fourth Hokage, Namikaze Minato. He was also a part of the Konoha ANBU force, which he left for unknown reasons.
Kakashi is a very good, and very strict teacher. Prior to Naruto's team, he had never allowed any of the teams he was to teach become genins. He uses the same teaching methods the Third and Fourth Hokages used, and he emphasizes teamwork above all else. He feels that someone who does not understand teamwork is not worthy of becoming a ninja.
Kakashi has the Sharingan implanted in his left eye. Not long after becoming a jounin, at the age of 13, Kakashi was assigned to lead his teammates, Obito and Rin on a mission. During the mission Obito sacrificed himself to save Kakashi from being crushed by a falling boulder. That's when he told Rin to implant his Sharingan into Kakashi's left eye, because he knew that he was dying anyway.
With the Sharingan, Kakashi has a huge advantage over his opponents in battle. He is able to read and copy his opponents movement and jutsu. Almost all of Kakashi's moves have been copied from other ninjas using the Sharingan. The only exception is the Chidori. The Chidori, or "Lightning Blade" as Kakashi nicknamed it, is Kakashi's sole original technique.
During the timeskip, Kakashi developed his very own Mangekyou Sharingan, greatly improving the normal Sharingan he had until then. It enables him to perform a special jutsu, Kamui, which sucks everything within a very small area and sends it to another dimension. We saw Kakashi putting his new Mangekyou Sharingan's Kamui ability to the test for the first time in Shippuuden, in the battle against Deidara, where he only managed to remove his arm, even though he aimed for the head.