Tailed Beast

In the Naruto universe there are at least nine demons called the that inhabit the planet. The organization Akatsuki, has a plan that involves the capture of the tailed beasts.

History
It seems that the tailed beasts were around before the First Great Ninja War. The shinobi nations first involved these demons by attempting to capture them and harnessing their powers to defeat their enemies. The attempt was impossible as no nation was able to control such power. Instead, the nations moved to capture the beasts and seal them in a human, a  jinchūriki (人柱力, lit. Power of Human Sacrifice). This method worked and by the time period of the series, the only known tailed beast to have not been sealed was the Three Tails.

Jinchūriki
The jinchūriki or host, exhibit extraordinary powers, and in some cases are stronger than their tailed beasts for the very fact that they are able to control their power. In addition, if a tailed beast goes too long without a host; it can lose its intelligence and become nothing more than a giant animal thus making it weaker. The hosts usually show some physical characteristics of the tailed beast within them and the beasts traits can become infused with the hosts personality. According to Akatsuki, the hosts tend to be lonely people who loathe humanity, which was proven true when the first two beasts sealed by the organizaiton was done with almost little effort from their ninja villages, infact they were glad to be rid of their jinchūriki. The tailed beasts also are protective of their hosts for the sole reason that if the host dies so does the demon inside. Likewise, if the tailed beast is removed from the host, the host would die. So far there is only two known methods to seal a tailed beast into a host. One Dead Demon Consuming Seal, which the Fourth used to seal the demon fox into Naruto, and the technique that Chiyo used to seal the Shukaku in Gaara. The only know technique to extract a tailed beast is Akatsuki's Illusionary Dragon Nine Consuming Seals, a three day long jutsu that with the combined effort of all Akatuski members forces the tailed beast out of its host and into a nine eyed statue. Akatuski has so far captured seven tailed beasts.

One-Tailed Shukaku

 * Name: One-Tailed Shukaku (一尾の守鶴 Ichibi No Shukaku) or Shukaku of the Sand (砂の守鶴 ''Suna no Shukaku)
 * Creature Type: Tanuki (racoon-dog, native only to Japan and other Asian countries)
 * Host: None, formerly Gaara and previously two unknown Sunagakure citizens.
 * Unique traits: Ability to spit concentrated balls of wind mixed with chakra
 * Status: Captured, extracted, and sealed by Akatsuki

The One-Tailed Shukaku was the tailed beasts that inhabited the Land of Wind prior to the start of the series. Its only known host was Gaara, but was later captured and sealed by the Akatsuki.

Two-Tailed Demon Cat

 * Name: Two-Tailed Demon Cat ニ尾の猫俣 Nibi no Nekomata
 * Creature type: Nekomata (magical, two-tailed cat)
 * Host: None, formerly Yugito Nii
 * Unique traits: Fire-breathing
 * Status: Captured, extracted, and sealed by Akatsuki

The two-tailed demon cat is a fire-breathing, flaming cat sealed within Yugito Nii of Kumogakure. Soon after her introduction Yugito is captured by Akatsuki members Hidan and Kakuzu, though it is unknown which was specifically assigned to capture her. Despite luring her two pursuers into a closed space, sealing the exits, and transforming herself into the demon cat, Yugito was overpowered and rendered unconscious by the two Akatsuki members. Zetsu later arrives to take her off their hands, and she later dies as a result of having the beast extracted from her.

Three-Tails

 * Name: Three Tails 三尾 Sanbi
 * Creature Type: Unknown (Kappa)
 * Host: None
 * Unique traits: Unknown
 * Status: Captured, and sealed by Akatsuki.

The three-tailed beast is a gigantic, turtle-like demon that Akatsuki assigns Tobi (with the help of Deidara) to capture. This creature may be based on the Genbu or the Kappa.

What abilities this creature possesses remains unclear, as it did little to actually attack the two in its short appearance. It is clearly quite fast despite its size, as evidenced by its ability to keep up with Tobi, who was running on the water at the time. With the three-tails distracted, Deidara molded an explosive clay fish in an attempt to capture it. It's unclear if this marked the end of the battle, as the remainder of the battle goes unseen. As the two towed the beast to the Akatsuki lair after the battle, Tobi gloated of bringing the three-tails down with his special jutsu, but Deidara thought otherwise. It is later sealed in the sealing statue.

Unlike the other tailed beasts seen thus far, the three-tails lacked a host. According to Deidara, lacking a host made the beast weaker because it wasn't intelligent enough to control its own strength.

Four-Tails

 * Name: Four Tails (四尾 Yonbi)
 * Creature type: Unknown
 * Host: None, formerly an unnamed elderly man
 * Unique traits: Access to many types of elemental chakra
 * Status: Captured, extracted, and sealed by Akatsuki

The four-tails jinchūriki is an elderly man of unknown origin who was eventually captured by Kisame Hoshigaki. Reportedly, it was a difficult battle for Kisame, who had to face many elemental fusions, rarely seen outside of kekkei genkai. The four-tailed beast is sealed before the end of the next chapter, leading to the old man's death.

Eight-Headed Demon Snake

 * Name: Eight Heads (Hachimata)
 * Creature Type: Snake
 * Host: Orochimaru
 * Unique traits: Eight Heads
 * Staus: Dead

The demon was killed by itachi while fighting sasuke. Since sasuke needed chakara he released Orochimaru. Itachi using the last of his chakara using a jutsu called susano chopping of the heads of the beast, thus sealing orochimaru away for ever inside sasuke

Nine-Tailed Demon Fox

 * Name: Nine-tailed Demon Fox (九尾の妖狐 Kyūbi no Yōkō)
 * Creature type: Kitsune (Magical many tailed fox)
 * Host: Naruto Uzumaki
 * Unique Traits: Near limitless chakra, massive strength
 * Status: Active, sealed in host.

The nine-tailed demon fox is a truly powerful beast; a single swipe of one of its nine tails can raise tsunamis and flatten mountains. The demon fox would appear as a natural disaster in an area where human malice festered. After the demon fox attacked Konohagakure, the Fourth Hokage sealed it into the newborn Naruto by using the Dead Demon Consuming Seal, sacrificing his own life to do so. It is said however that Madara Uchiha had the power to summon the demon fox, and he was the one behind the attack on Konohagakure.

Legend of the Tailed Beasts
According to some fans, the "Legend of the Tailed Beasts" is an epic story from Japanese folklore which Naruto author Masashi Kishimoto draws from to create the tailed beasts in his work. However it is an example of internet-based fakelore which originated on Chinese websites, some suspect this chinese site.

The veracity of the legend breaks when it is cross-referenced with non-fandom sources on Japanese folklore. For example, the isonade, which is held to be the three-tailed beast in this account, is in fact equipped with only one large, hook-covered tail, and the "houkou" which is actually a Chinese creature called penghou, named as the five-tailed beast, has no tail at all. The badger was said to be the lord of all these beasts in the original legend, and Naruto fans have claimed certain Bijuu to be a badger instead of it's true form which was a tanuki for Ichibi no Shukaku and a bat for Shichibi no Makumore)

Additionally the author of the story admitted it was not a true legend, unfortunately it has gone largely unnoticed by most fans of the story.