Originally a variant of "yes", used to express joy at something unbearably sexy. Came from people's inability to type when they were so erotically excited.
When you correct yourself in the middle of the word, no-yes.
Bob: "Hey John, you wanna come rob a bank?"
John: "No."
Bob: "Hey John, you wanna come to church?"
John: "No."
Bob: "Hey John, you wanna come get some drinks?"
John: "Nyes."