Warning: Wikipedia contains spoilers
He is a peroxide blonde vampire, who showed up in Sunnydale in the show's second season, with his then-love Drusilla, who was suffering from a mysterious ailment.
After Angel lost his soul and began a plot to destroy the world, Spike allied with Buffy Summers to get his love back. He later returned to Sunnydale, having lost Drusilla, but before he could strike out at Buffy Summers, was collared with a microchip that induces crippling electric shocks whenever he attacks humans. Later, he found himself falling in love with Buffy.
Spike is also known as "William the Bloody". He acquired the nickname before having been turned into a vampire, because his poetry was so "bloody awful".
At the end of Season 6, Spike had his soul returned, and early episodes of Season 7 focused on his guilt and repentance for his previous acts of evil. In the Season 7 finale, Spike sacrificed himself to save the world. A shiny bauble he wore radiated with sunlight and destroyed a legion of uber-vampires. In the process, Spike incinerated, but not before Buffy told him she loved him - a claim he said he did not believe.
Despite his apparent death, Spike returned in Season 5 of Angel and is now a regular.
Notes: Originally Spike's "sire" was thought to be Angel, but later it is clarified that Drusilla did the actual "siring", but Spike refers to Angel as his sire, because Angel sired Drusilla.