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1337 h4x, or to j00 n00bs, is the l337 version of Elite Hacks. Essentially defined as someone h4xing j00, what it basically means is best described through a real-life, slightly counter-strike based example. For example; "Omgz, i r t3h st4nding here and r totally HSd. That guy is such h4xx." Possibly originating in the year 1337, but is technically undated.
edit Darwin's Theory
Possibly, 1337 h4x does not exist. It is widely believed, and possibly true that the idea of 1337 h4x was created by n00bs in an effort to conceal the fact that they suck at life. The idea of 1337 h4x was thought up by Charles Darwin in 1849 when he realized that humans did in fact evolve from monkeys. He thought that just the idea of this was, "elite," in this fashion meaning, "superior to everything else." When government officials discovered a diary of his in 1988, it was kept quiet for many years until the internet became popular in the late 90's.
As people were getting more and more used to computers, talking to friends online and such, the theory of Elitism, Darwin's newly found religion, which he kept in the dark until he died, eventually leaked out of the government's control. According to further research, it appears that someone hacked into their system and stole some information, releasing it into the world through the internet. It has been confirmed, though, because the internet is such a large environment, that this information, though very hard to find, is still out there somewhere. This became a more and more popular hobby, hacking, and as it was not fun for the one end, it was certainly funny for another. Though soon, the idea died down.
After a while, some people became more careless and lazy and started using more "acronyms" instead of words. Acronyms have the same idea as abbreviations, but instead of using the first few letters of one word, the first letter of many words are used. One of the most popular acronyms used today would be "lol," or "lolling out loud." Today, with much practice, you can make acronyms out of most anything.
edit Alternate typing
After acronyms became popular, with people being so lazy, they eventually derived a "different" way to type, using Z's instead of S's, X's instead of CKS's, and numbers instead of letters, like when calling someone a noob, someone would say, "hay n00b," using two zeros instead of O's, and an 'a' instead of an e. In late 2003, when MMORPG games became popular, the idea of hacking started yet again. Players would start saying 'they were hacking,' if they found a bug in the game, which lead up to numbers, 'h4ck1ng,' then different spelling, 'h4x1ng,' which lead up to 'h4x,' and then h4xer, then h4xor, and so on.
edit 1337 H4x
In early 2005, Darwin's theory of Elitism found a way to leak out again, leaving the internet with yet another word for modification. The word grew, leaving people saying, leet, l33t, 133t, and finally, 1337. And of course, how perfect was it that the internet had the words 1337 AND h4x? And, yes, they put them together, forming the bond we know today as 1337 h4x, or Elite Hacking (but if you say that then you are a n008).
edit How to tell if someone has it
It is always proper to assume, when losing at anything, that your opponent has 1337 h4x. Thanks to the vast amount of n00bs who use 1337 sp34k, the usage of numbers, replacing letters in a word, or the official language of 1337 h4x, it is impossible to truly distinguish 1337 h4xX0rz from everyone else, although you CAN accuse everyone and hope you hit the money somewhere along the line.
However, Charles Darwin stated, "I believe that if someone or something shows improper behavior or performs idiotic actions with entirely no reason given, then that someone or something certainly can not be elite."