A derivitave of the 80's software piracy scene. Originally "elite" was used to show status on a BBS. Commonly the people who cracked the software, or had sysop access on a board would be referred to as Elite. Later it became common to just use "leet." With the internet explosion it was later used to describe hackers as well as crackers. Due to it being great to be known as leet, newbies started adopting the term and using to describe themselves, often with numerical variations. Anyone who considers themselves "leet" should be able to tell you who/what Razor1911 is, anyone failing to answer this question should be laughed at.
"Wow, those guys that run this new board are leet, they had win 3.1 a week before it came out!"