The Got Medieval blog traces the history of fanfic all the way back to the middle ages, when enthusiastic Chaucer nuts wrote their own Chaucer sequels, and even wrote themselves into the literature of the day:
Chaucer seems to have attracted this sort of activity more than other writers–or possibly, we modern readers are more interested in tracking down this sort of thing when it’s done to a writer we admire as much as Chaucer. Chaucer left a lot of gaps in the Canterbury Tales, and other writers stepped up to fill them, writing tales for the poor Ploughman who never got one in the original, an extra tale for both the Merchant and the Cook, and a whole story about what the Pilgrims did once they got to Canterbury. Robert Henryson, a 15th-century Scottish writer, went so far as to write a sequel to Chaucer’s earlier work, Troilus and Criseyde, in which he punishes Criseyde for all the things Chaucer had her do to poor, noble Troilus.
(via Making Light)
See also:
California got its name from fanfic
How fanfic makes kids into better writers (and copyright victims)
In Praise of Fan Fiction: Cory’s latest Locus Magazine editorial
Organization for Transformative Works: defend fandom!