Ironically, GIF is not a word, but an acronym. It means Graphic Interchange Format, and although it's 25 years old, it wasn't until this year that Oxford decided to recognize it's cultural significance. As you probably know, the format is the most popular way to share animations online, mostly because of its compatibility with pretty much every web browser out there.
The format is exploding in popularity right now thanks to websites like Tumblr. We've also launched not one, but three sites based around GIFs this year because we recognized the popularity of the format. If you're curious Oxford also said that it was appropriate to pronounce GIF with either a soft or hard G, although the creators pronounce it Jiff like the peanut butter brand.