We know drama.
LiveJournal is a social networking website. LJ's English-language content tends to be more diary-like than other blogging sites, and as such it had a reputation for being frequented by young and immature teenagers. Its format is user-friendly and highly customizable, offering multiple user pics, mood settings, and journal layouts. Because of its more personal approach to blogging, LJ attracts a lot of teenage girls. It also attracts a lot of drama. The two are possibly related.
The site is also greatly used by fanfiction writers, possibly due to the comments section, which makes each entry something like a miniature forum. As such, LJ is home to many communities, which discuss everything from knitting to politics. Mainly, though, it's fanfiction. A lot of fanfiction. LiveJournal seems to specialize in writing communities, of which it has hundreds, most of them fanfiction. Roleplaying communities were also popular (most have since moved to a Spin-Off, Dreamwidth), all of them basically fanfiction.
LJ's popularity has dwindled in recent years, with the advent of first Myspace, then Facebook, and then Tumblr, which attracted a lot of the slash fangirls who previously used Livejournal. It also garnered a reputation for banning journals because of "objectionable content" (particularly Strikethrough '07) which violates the Terms of Service; this is called TOS'ing. LiveJournal has TOS'd some of its most popular journals, like Fandom_Wank and scans_daily. Major changes to the site interface in December '11 drove many fandom users, particularly roleplayers, off the site as well.
LJ's journal system is open source, so a lot of clones have sprung up over the years, and (in some cases) subsequently perished; survivors include InsaneJournal, DeadJournal, JournalFen (now mostly dead after a server collapse) and Dreamwidth. Since its founding, JournalFen was a haven for Fandom_Wank (Archived link), which existed largely to point out LiveJournal' drama. Scans_daily moved to InsaneJournal and then to Dreamwidth.
LJ is also, for unclear reasons, the most popular host for Russian-language bloggers, to the point where the Russian term for blogging is derived from the Russian name of LiveJournal. A Russian company now owns the site, a number of high-profile Russian politicians maintain LJs, Russian authors used LJ to publish excerpts or teasers for their new books, and it's even been theorized that the DDoS attacks on the site in April 2011 were caused by the Russian government in order to silence a critical blogger. The Russian content on LJ is a lot more like the rest of the English language Blogosphere, and rarely interacts with the English-speaking side of LJ (aside from the occasional Russian spam comment on an English-language journal). However, LJ's servers are now located in Russia, so beware of hosting sensitive content there or anything that would violate Russian law, such as content that could be seen as promoting homosexual behavior.
See also: Journal Roleplay - This particular style of roleplay started on LJ.