Generally used to express a form of joy. The word originated in competitive online gaming as an acronym for "we own other team." The term has since adopted a more general meaning.
exclamation of joy, origins much-contested, but definitely pre-dating online games such as Counterstrike and Everquest- oldest usenet post containing such usage is January 08 1996. Said to originate from 133tspeak (which would pre-date that post by several years), an exclamation of 'root!'- meaning someone had achieved root-level access in a Xnix-based system, and thus, had full access.
W00t is a short expression of joy. In hindsight, reverse engineering has erronoeusly determined that this is an acronym for "we own the other team", but of couse that is patently absurd.
Guy A: ''OMFG we just pwned those n00bs into nubsauce.''
Guy B: ''I need more w00t beer, man, I've been up for two days and i'm crashing BAD lol''
Guy A: ''Fridge. Top shelf. And hurry up, the rounds about to start!''