Hacks are programs running in the background of World of Warcraft (or other applications) with the intent to modify the information the program is using. Hacks are most frequently used to accomplish tasks that the maker of the application did not intend. The most common hack in World of Warcraft is known as a speed hack or a teleport hack, which controls the position of the player in ways they should not be able to travel normally.
Hacks are strictly illegal, and are a bannable offense by the Terms of Service agreement.
A running joke among players is that when someone is able to do something that the other party feels they shouldn't, like roll a 100 on a /random, they blame it on "hax."