A caricature was, originally, a portrait in which the characteristic features of the subject were presented in an exaggerated fashion, to make sure that the result was recognisable (even if unrealistic). One sometimes sees caricatures in which the nose is shown as enormous, or in which a face disappears behind huge spectacles, or a moustache hangs down below the level of the shoulders.
By extension, there can also be caricatures in writing, or in performances. Many comedians and impressionists work by caricature. The word can now also be used as a verb - to caricature means to make an exaggerated (and possibly unfair) representation of someone, their mannerisms or their ideas.
Note that, unlike the word 'character', with which it shares an origin, caricature is spelled with no '-h-'. Its pronunciation in RP, and most academic discourse, puts the stress on the first syllable: 'CARR-i-cat-your' (IPA: /ˈkæ rɪk ə tʃuː ər/), although a realization is to be heard with the stress on the second syllable, 'car-RICK-et-your', /kæ ˈrɪk ə tʃuː ər/. AWE advises you to resist this.