Motherfucker is a vulgarism which, in its most literal use, refers to one who participates in sexual intercourse with someone's mother. The term gained traction during World War II, originally amongst African American GIs, and was applied to American soldiers (black, white, or otherwise) in war-torn Europe who would trade food, money, or anything of value for sex with desperately poor or starving French and German women. Many of these women were housewives whose husbands had been conscripted away, killed, or imprisoned, leaving the women to support the couple's children alone.
In the last 60 or so years, the term has entered the popular slang as a term of derision ("That guy is a real motherfucker, you know?"). More recently, it has been used as an indicator of extraordinary intensity, not necessarily in a derisive sense, but usually still carrying some implications of harshness ("I fell asleep out in my lawn chair, yesterday, and got a motherfucker of a sunburn.") or intimidating awesomeness ("That dude, he's one baaaad motherfucker!"). In most cases, it is just a term of abuse.