It’s official: LOL means “laughing out loud”

The traditional meaning of LOL is “lots of love”. In online communication, LOL has become popular as an abbreviation for “laughing out loud”. With it, the writer expresses amusement about something. I usually prefer alternatives such as :-) (smiley) or “hehe”. Now the Oxford English Dictionary has been updated to reflect the more prevalent use of LOL.
Quoting Nate Anderson [1]:
The venerable Oxford English Dictionary has long been the definitive reference work on the English language. This week, it lent the majesty of its name to “LOL” (laughing out loud), a shiny new entry which will now join OMG, IMHO, TMI, BFF, and other linguistic "initialisms" in the dictionary. And why not? It's a perfectly cromulent word.
LOL is defined as an interjection, “originally and chiefly in the language of electronic communications: ‘ha ha!’; used to draw attention to a joke or humorous statement, or to express amusement.”
Not surprisingly, LOL also makes it into spoken language and literature, which Anderson points out [1]. If someone only knows the traditional meaning of LOL and uses an online medium, it can lead to results that are funny for those who also know the newer meaning. The following message is an example of this and has been posted by a mother in her late 50s [source: reddit].
I’m really sorry to hear about your son’s accident. LOL
Related reading:
  1. People officially say "LOL" out loud