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kwned is a rarely used edition of the word owned and pwned.

In certain first person shooter games (namely Counter-Strike), players are equipped with a primary weapon, a secondary weapon, and a melee attack. In Counter-Strike (CS hence forth) players are given a knife. To "kwn" a person would be to own them with the knife.

Note that the K indeed stands for knife, and to use it in the context of being hit (such as in Halo) would be incorrect.
FatManMGS2 killed Noob with knife.

Noob: Darn!
FatManMGS2: kwned
kwned by FatManMGS2 December 30, 2006
Related Words
'Klwned' is similer to pwned, in that people are made fun of/look stupid. To be klwned is to pwn oneself, making a complete idiot of yourself. People usually klwn on a BBS such as the one at newgrounds.com.
Person 1: we make fun of windows cos of its lack of reliability, the mac is WAAAAAAT more reliable
Person 2: lol klwned.
klwned by -liam- September 24, 2005