Hatsune Miku is just an overglorified VST preset
You take that back!
But back on topic here. Google will get you miles on this one. Google her name and the first result is her entry on Wikipedia, which should most definitely answer your question and give you some history on the origins of Miku.
Unlike human singers which pretty much have a preset skill level that rarely changes, how well a vocaloid sounds is based mostly on the skill of the person using the Vocaloid program. Back when she was first released, it consisted of just the program that outputs her voice and the cover art that defines her physical appearance. The only back-story/description Crypton officially released about her was "Hatsune Miku is an Android from the future where song is lost". Or something to that effect.
The company never officially indicated what personality she has or anything. It has been left to the fans who created and/or listened to her music to define her. I guess you can say she is an "open source diva" so to speak with each fan putting their own spin on her.
MikuMikuDance came later on and that allowed folks to produce custom animations of Hatsune Miku and other Vocaloids. (my GIF in my signature is one prime example of something made in MikuMikuDance).
Currently my favorite music video of her is this one:
This particular artist does a really good job making her sound human which is not an easy task by any means. Show me an overglorified VST plugin that does that! That's what I thought!
By the way Crypton is going to release the "English" version of Hatsune Miku this Saturday. Unlike normal voice synthesizers. (like the one Stephen Hawking uses for example), the voice isn't 100% artificially generated.
A real life human (usually voice actresses in the case of Vocaloids) provides all the possible phonetics of the language which are recorded at a studio and compiled as a "voice bank" for the Vocaloid program to use. It then combines the requested sounds by the end user and alters their pitch and tune in a manner similar to AutoTune to create the final result.
They had the voice acter do all the English pronunciations for the English version which will allow artists to make her sing English lyrics and have it be easier to understand and sound better. There are already videos/songs out there where they manage to get her to sing English with the Japanese sound bank, but it's heavy in "Engrish" and is hard to understand in most cases.
Also note, that video I linked to above, that artist also made her sing a few verses in Spanish as well and not all of it is Japanese. The limits of a Vocaloid is constrained only on how much work the end user wants to put into it.
