Lotho was an unpopular hobbit, he was widely known by the mocking name Pimple, due to his complexion. When his father, Otho, died in S.R. 1412, Lotho inherited pipe-weed plantations in the Southfarthing, selling the pipe-weed to people away south.
After Frodo sold Bag End to Lobelia in September 3018 and left the Shire, Lotho continued to sell pipe-weed to the Wizard Saruman, becoming richer and more powerful, and using the proceeds to buy land and property all over the Shire in order to control it.
Men ("ruffians") from Isengard starting coming into the Shire and help Lotho control and supress the people, and with their help, he desposed of the rightful Mayor of the Shire, Will Whitfoot, and imprisoned him in "Lockholes", naming himself Chief Shirriff, or simply Chief.
Lotho continued ordering, industrialising and controlling the Shire's life until Saruman (called "Sharkey") arrived in the Shire, in September 3019, and took over direct power. Lotho was held prisoner in Bag End for a short while until Gríma Wormtongue killed him in his sleep (or possibly ate him). Thus, the hobbit who tried to take over the Shire, met a very untimely end.