08.30.07
History of Islam - What is Hadith?
Basically, hadith is Arabic for oral traditions. According to DrB:
The earliest Muslim literature outside of the Qur’an includes collected stories and sayings attributed to Muhammad. These accounts were recorded at least a century later, and assigned to Muhammad through a transmission (isnād, اسناد) of authorities. These lists gave an account of a saying stretching back to a Companion (الصحابة) of Muhammad through Followers (التابعون) and later disciples of Islam, which were recorded later. … The term has taken on a specialized meaning in Islam, meaning what is attributed to the prophet. In Islamic tradition, the Hadīth and Sunna formed the basis of communal life. In many cases they were identical, yet there are many divergences. The Sunna described the method of doing something, particularly in regard to ritual. Hadith served as a means of incorporating customs and traditions into the authoritative body of the society. In this respect, ahādīth (pl. of hadith) were used to inculcate into Islamic practice the traditions about Muhammad during his life. The hadīth functioned as a system to verify contemporary Islamic practice by relating what the prophet did in his life and thus abide by his example.
There’s more about hadith at Wikipedia but as always caveat emptor.