Tailed Beast

In the Naruto universe, there are nine giant demons called the that inhabit the planet. They are actually living chakra in physical form, often referred to as "Chakra Monsters". The Akatsuki organization has a plan that involves the capture of the Tailed Beasts.

History
The Tailed Beasts have been around before the First Great Shinobi War. Because of their immense power, the shinobi tried to use each of the Tailed Beasts as military weapons during the Shinobi Wars. After the Wars, Hashirama Senju, the First Hokage, managed to capture and control them with his Mokuton techniques, and used them as a peace treaty to the other great shinobi nations, in order to stabilize the balance of power between them. After his death however, the shinobi nations couldn't control these giant demons themselves and they began to run wild. Their attempts to capture them and harness their immense power failed as no nation could control such power. Instead, the nations moved to capture the Tailed Beasts and seal them within humans, which they were called Jinchūriki. This method worked and by the time period of the series, the only known Tailed Beast to have not been sealed into a human was the Three-Tailed Beast.

Jinchūriki
Jinchūriki or hosts, 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. If the Tailed beast is removed from the Jinchūriki, the Jinchūriki will die.

One-Tailed Shukaku

 * Host: Gaara (formerly)
 * Status: Extracted, Sealed

Two-Tailed Demon Cat

 * Host: Yugito Nii (formerly, deceased)
 * Status: Extracted, Sealed

Three-Tails

 * Host: None
 * Status: Sealed

Four-Tails

 * Host: Old Man (formerly, deceased)
 * Status: Extracted, Sealed

Eight-Tails

 * Host: Kumo Shinobi
 * Status: Active

Nine-Tailed Demon Fox

 * Host: Naruto Uzumaki
 * Status: Active

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.