|There is more information available on this subject at Pwned on the English Wikipedia.|
"Pwn" is an Internet slang term. The term originated from a typo. In PC games, where communication between players was only possible with a keyboard, gamers would often type "owned" when declaring victory; the nearness of the "O" and "P" keys often resulted in the typo "pwned". The mistake eventually became a popular and deliberate misspelling.
As the term became more popular, its usage spread to non-textual mediums. It can be heard quite frequently on voice chat in Halo 2 and Halo 3. It is typically used to by a victor to describe a crushing defeat of their opponent. In some cases, it can be used as a taunt, intended to annoy or anger the defeated player.
The spelling of the past-tense verb varies. The most common spelling seems to be pwned, derived from the original "owned". Common variants include "pwnd", "pwn'd", and "pwnt". The pronunciation of the term is also variable, due to its textual origin. Some pronounce it the same way "own" is pronounced (/ˈoʊn/), due to the word's origin as a typo. Others include the "p", resulting in "pone" (/ˈpoʊn/). It is also commonly used in Machinima