to destroy or devastate, to achieve victory in absolute terms...generally used as slang term among video-gamers and the population born in the late 1980s/early 1990s.
"Pwn" comes from its root word: "own". The word "own" evolved in early Middle English from Old English, from root "agan" meaning "to have, to own". It became obsolete after 1300 AD, but was revived in the early 17th century, in part as a back-formation of "owner" which continued to modern day. The meaning "to own up" or to "make full confession" began use in vernacular in 1852.
Over time, with the advent of the video-game industry, modern English has evolved to include use of many slang and condensed terms to adapt to the needs of the fast-paced virtual environment. For example, typing the term "I beat you" requires a significant time investment when you take into consideration the environment changes in game which can range from virtual bombs being dropped from war planes to enemy soldiers charging your virtual base gates. Therefore, the ageless practice of "smack-talk" needed to become swifter and easier to implement.
There are conflicting theories as to the evolution of the term "owned" as smack-talk. However, it is commonly held that the term came about to mean that one competitor is so immeasurably superior to one's adversary that they can do whatever in the game and still win. Akin to meaning the superior competitor "owns" the other player, making him do whatever he/she wants. The term is said to have come about when Blizzard, Inc. introduced its groundbreaking and award winning Starcraft RTS (real-time strategy) game in the mid-1990s.
The term "owned" rapidly became a popular term among video-gamers. However, with the release of Starcraft: Brood Wars it is said that there was one match where a player accidentally missed the "o" key and hit "p" instead - typing "pwned". Since then, constant ridicule of that legendary player's poor language skills has lead to an explosive increase in the use of the new term "pwned".