1. Noun; nouns coming before it often act as adjective ("
Warhammer 40,000 Fanfiction"). A story based within a pre-existing world, which may or may not include
canonical (canon) characters as major or minor actors. Usually also includes
non-canon characters, commonly referred to as
OCs among the community. Though technically canon characters are also OCs, stories that focus majorly or entirely around OCs are considered 'OC fiction', or 'OC stories.' Many OC stories allow readers to submit their own characters to the story, though it's wise to do some research before hand to avoid having your character butchered.
There are many fanfiction writers out there who do genuinely amazing work with fanfiction, especially with stories which involve no canon characters. It's very difficult to butcher a canon character's personality if they're not present, and it's fairly easy to remain true to lore in most cases.
Unfortunately, there's also a lot of horny idiots who write fanfiction so that they can see their favourite characters having sex, even if there is no way this would ever happen in the source material ever. There's also a fair amount of fics that turn otherwise well-rounded characters into complete Mary
Sues (see the fanfiction written for
Homestuck's Vriska--actually, don't; I don't want to responsible for making anyone cry), or which completely ignore established canon in favour of
headcanon.