He was created in a contest for making up a scary character. It began with Marble Hornets.
Why is it used? It's a part of the "pop culture" magick that has been ridiculously popular with many young neopagans.
The closest actual being in folk lore close to Slenderman which many believe he was constructed from, is Der Grossman, a black elf king said to haunt the Black Forest of Germany and kidnap naughty children. The child abduction part was a scare tactic to keep kids from wandering into the woods. Basically, Der Grossman is a nature spirit on the darker side of things. Later, and more popularly, he was known as the "boogey man".
So, when you read headlines about Slenderman and think it's so concerning, replace the name with the "Boogey Man" and you'll see how ridiculous these people really are.
Unless of course, you really are in the Black Forest of Germany. Then, I wouldn't laugh. In Iceland, they recently stopped the construction of a road because it happened to run through elf territory. True story! They take that stuff there seriously.
People worship slenderman because he is a fictional being thats mysterious and peaks that "boogeyman" side of us. Same with Lovecraftian characters.
It is a fad and to be honest i think creepypaste is not always such a good influence. I have nothing against any of it. Just remember next time it annoys you someday the fad will die down. Also the creepypaste stuff isnt REAL or has any reality to it whatsoever.
He's not real,although sources show that he may have originated from medival Germany(or a country close to Germany)
With what I saw,he was described as a tall,faceless man,who killed people grusomely and it was believed that if he came for you,he would ask you a question,if you get it right,he'll just brake one of your limbs and if you get it wrong,he'll put his hand down your throat and slowly rip out your heart.
You can google this if you think I'm lying,I'll try and check for the source again
You might also want to look up the Nopperabo, a yokai (folkloric being) from Japanese mythology.
Here's an interesting video about Slenderman as the Internet's first folkloric being, "existing" within the liminality allowed in horror stories: https://www.youtube.com/watch?v=R0RNkkd2peE
"Hush, thy childe, do not stray far from the path,
or The Faceless One shall steal you away to Fairieland.
He preys on sinful and defiant souls,
and lurks within the woods.
He has hands of ebony branches,
and a touch as soft as silk.
Fear The Faceless One thy childe,
for he shall take you to a dark place.
And what shall become of thou?
Noone knows, so be good, thy little one-
Alas! He is here to take thou away!