The Rinnegan are the eyes of reincarnation and is said to be the most illustrious of the 3 dojutsus. Originally these eyes were held by the sage of the six paths, a man who founded the ninja world by inventing ninshuu. The Rinnegan can only be attained by the combination of Senju and Uchiha blood, such as the case of Madara Uchiha and Obito. The Rinnegan is said to be a tool of God that can either bring salvation or annihilation.
The Rinnegan is characterized by six "rings" that surround the pupil. These "rings" each represent one of the six paths of Buddhist reincarnation: Deva, Asura, Human, Animal, Hungry Ghost, and Hell: all of which it derives much of it's powers from.
The first ability of this amazing dojutsu is the ability to use all 5 elemental chakra types and can learn ninjutsus at a much faster rate, and like the Sharingan and Byakugan it can see chakra. But it's most notable abilities are: gravity manipulation (Deva), body modification (Asura), telepathy (Human), summoning (Animal), chakra absorption (Hungry Ghost), and resurrection (Hell). Each one representing one of the six paths of Reincarnation or Samsara. The Sage was said to be able to transcend the six paths using the outer path to bring people back to life.
In addition to having control over the six paths of reincarnation the Rinnegan is said to have control over the outer path that is beyond life or death. This is demonstrated when Tobi uses the Demonic Statue to bind the Tailed Beast to his will as well as when Pain uses the chakra rods made from the outer path in order to control the other paths. But by far the greatest demonstration of it's full power is shown when Nagato uses it to resurrect all the dead shinobi killed during his attack on Konoha.
Users of the Rinnegan
Madara - Current, obtained by infusing the First Hokage's dna into himself, thus combining Senju with Uchiha.
Pein (Nagato) - Former, obtained by Madara giving him his eyes.
Obito Uchiha- Current, obtained by the help of Madara Uchiha.
Rikudou Sennin - former and the first known.