1. A hacker who is a real retard. They usually hack a site out of "revenge" on the owner.
2. Someone who pretends they are a hacker, when they are really not. They speek leet. Some will go so far as to find a password another retard left lying aronud on a peice of paper, and if they can figure out what it corresponds to, use it and say they hacked the person.

One who is dumb, idiotic, stupid.

Combination of "hacking" as in hackin' idiot, and "retard".