Almost all accounts on a computer system have some method of restricting access to the content, probably in the form of a password. Without a password hack, to gain access to the system you need a valid ID and password to login and see the protected area. This is how passord hack comes in to play. For privacy concerns the system usually prints asterisks in place of the real characters.
When you enter a password it is processed through some type of algorithm to generate a hash. The original text that made up the password text is scrambled, in a one-way hash. This way the string of characters that cannot be reversed to find the original text. That makes password hack very difficult on some servers. Computer systems do not decrypt the stored password during authentication, they store scrambled hash. When you login, you supply an account and password. This password is put through an algorithm that produces a one-way hash. This hash is compared to the hash stored on the system. If they are identical access is granted.
Of course, some algorithms are much better than others at generating this one-way hash.
To password hack you need to get a copy of the one-way hash stored on the server, and then using the algorithm generate your own hash until you get a match. Finding a match, whatever word you used to generate your hash will allow you to login to that server. Obviously this can time many attempts and a lot of effort. That is why scripts and programs that automate the process are used to password hack. Unfortuantly, there are lots of freeware password hack programs available on the internet.
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