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The Toclafane were fairy tale monsters from Gallifrey, their name, like the Bogeymen on Earth, just made up.
In 2008, the Master claimed to have contacted the Toclafane (in reality a race of Human-based cyborgs) and, using a paradox machine linked to the Doctor's TARDIS, allowed the entire race to pour through to decimate the Human population and create a Time Lord Empire. (DW: The Sound of Drums / Last of the Time Lords)
Behind the Scenes
The Toclafane were based on V.I.N.CENT from the Walt Disney film The Black Hole, who looks a bit similar but has a much more friendly personality.