Warning: Wikipedia contains spoilers.
Xander's main role on the series is to provide comic relief. He resorts to sarcastic comments and sophomoric humor to relieve tension, a characteristic that often annoys those around him (especially Rupert Giles). In this respect, Xander provides a dose of realism to the series, as people do tend to use humor to handle stress. Another comic aspect of Xander is his tendency to poke fun at himself, revealing a low self-esteem. Xander's insecurity and immaturity not only reflect the common stereotype of the teenage boy, they also serve to strengthen the Buffy character by making her appear more mature and capable.
Despite Xander's weak self-image and sarcastic personality, he has proven himself time again as a supporter of his friends and a courageous member of the gang.
Though he is quite good-looking, Xander tends to be unsuccessful romantically. He does have relationships with Cordelia Chase and Anya, though. Unfortunately by the end of the series he has lost one of his eyes.
Around the second season of the show it had been decided by writer Joss Whedon that one of the characters was going to eventually be openly homosexual. It was determined that this would either be Xander or the character of Willow; as such, personality changes were made to make each of them relatively sexually ambiguous, regardless of the gender of the characters with whom they were romantically linked. (In the event, Willow was the character chosen.)
