Oni are a mythological race Japanese creatures surrounded by much superstition that still continues today to a small extent. Once considered gods in ancient times, but ever since the introduction of Buddhism during the 6th century they began to take on characteristics of demons. The article below talks about the original ogre-ish demons.
In popular Japanese mythology and folktales, the oni is a monster of extreme ugliness and strength, thought to threaten the very fabric of human life. The popular visual description of the oni is a hideous, hairy giant clad in only a tiger-skin. His mouth opens all the way to his ears, and facial features include bull horns and tiger fangs. The female oni appear as beautiful women but quickly turn ferocious with jelous rage. Scholars still debate the exact origin of the oni, but it's agreed that this modern image is a latter-day establishment.
Older texts suggest that the ghosts of the dead and anything supernatural (I.e., those things which were'nt considered devine) were called oni (before Japan was unified under imperial rule, members of clans opposing the imperial house were often demonized as oni). As Japan converted to Buddhism, Buddhist images of the rasetsu became confused with the native Japanese oni. The rasetsu is a carnivorous demon-the male utterly ugly, and the female superhumanly beautiful, sometimes depicted as a denizen of hell and thus a lower life form on the great wheel of karma. Later Buddhist lore converts the rasetsu to Buddhism where it becomes a fierce defender of Buddhist beliefs. Chinese astrology, which assigned the twelve Chinese zodiacs to the points of the compass, was yet another spiritual influence on the oni's development. The direction of bull-tiger (northeast) was considered to be the direction of the demon. Thus the oni came to have bull horns, tiger fangs, and tiger-skin underwear. is established in various heroic legends. Regional clans that defied imperial rule were demonized as were bandits and highway robbers who haunted the mountains like invisible spirits. Hence, one of the first shoguns of Japan, Sakanoue no Tamuramaro, historically known for commanding expeditions to quell regional rebellions, is fabled to have slain a famed female oni. The same goes for the bandits turned into the oni of Rashomon, slain by Watanabe Tsuna, and the most famous oni in history, Shuten Doji. Even the oni in the children's story Momotaro or "Peach Boy" are identified as refugee invaders from the Korean peninsula, slain by the historically real Kibitsu no Miko.
Throwing peas at an oni is believed to make him blind. So in the exorcism ritual of Setsubun, held every 4th of February, families throw peas in and out of the house to chase out the evildoing oni for one year. However there are also localities where the oni is treated like a benign spirit such as Saeba of Fukui Prefecture, where the oni performs exorcisms. The "Namahage" oni of Akita Prefecture visits houses on New Year's Eve looking for naughty children to take away with a giant knife. He will leave presents for the good children, but to the adults he is the apparition that visits to bless the household for good harvest the next year.
The oni is a malvolent figure. People who died of famine and epidemics became oni. Wronged women became oni from their jealousy and rage. With the advent of the Noh theater-influenced by Zen Buddhism in medival times-as well as kabuki, which was influenced in turn by Noh, a picture of the oni that has finally settled into the popular consciousness is that of a by-product of human karma. - end
Relevance to Inuyasha
Oni make sporadic appearances throughout the series, during Sesshomaru's first appearance he attacks Inuyasha while riding on the shoulder of an oni. Later, Sesshomaru practices his Meido Zangetsuha technique on numerous oni. Of course, oni appear much more often, and in a more comic fashion in Takahashi's first work, Urusei Yatsura.