The son of Hatake Hakumo, the White Fang, he was always angst-ridden and pointed at by the people of Konoha over the fact that his father chose to help his friends instead of carrying out the mission succesfully.
He was a prodigy shinobi from an early age, always obsessed with doing things the right way, that meaning merely 'being a killing tool', which was what ninjas were originally meant to be.
Until he met his teammates Rin and Uchiha Obito. Obito, his dying partner that transferred his remaining sharingan eye to him, is the one that first said these famous words:
"Those that break the rules and regulations are scum. But those who abandon their comrades are worse than scum"
Through the series, we see how Kakashi changes his vision of life and the world, a transition from the old era of ninjas, from the cycle of never ending wars and hatred, to a more human one, and that is also through his disciples Sakura, Sasuke and Naruto (Team 7).
Kakashi-sensei also has a funny side, always arriving late to meetings, and reading the soft porn novels written by Jiraiya (Icha Icha tactics) in his free time, which means he's also a 'closet' perv ^_^
I don't think we will get to ever see his face without the mask, yet the episode with Naruto, Sakura and Sasuke trying to find out is one the classic moments in the series.