someone who exceeds the boundaries of a normal "lol," a descriptive word used to express a certain person or creature which is deemed worthy of ridicule, especially for being a noob.
It means, "laugh out loudcakes." Now, some people like to say "lolpie," but that is incorrect. Lolcakes is more grammatically correct, and is used in everyday language more often.
Jeff: Why did the chick cross the road?
Don: I don't know, why?
Jeff: To SUCK SOME FUCKING COCK.
Don: ohhh lolcakes!
Lolcake - a term used to alert those around you to your state of hilarity. Derived from Lol and pluralled to become lolcakes this word is pretty much kickass for it's use in modern day hubz.
bloodninja: I steal yo soul and cast Lightning Lvl. 1,000,000 Your body explodes into a fine bloody mist, because you are only a Lvl. 2 Druid.
Me: LOLCAKE!