In a world where "lol" is put after every sentence, this term is used to show that you actually laughed.
Dude, I lol'd!
Another use for lol, also used in image macros with "I lol'd" below.
Guy 1: Dude, that was awesome!
Guy 2: Yeah i know.
Guy 3: I lol'd
The verb for the phrase lol. People, mainly on the internet, use it to say that they laughed at a particular thing.
Person 1: This picture is hilarious.
Person 2: (Looks at picture.) Wow, i lol'd.
Person 1: Who says that?
Person 2: lol.
Person 1: Argh, my spots just came back
Person 2: I lol'd at your face.
I laughed out louded.
A: I lol'd.
B: You're an idiot.