Skippy, a young rabbit (at seven years of age "going on eight", as he once told Robin Hood), is the oldest son of Mother Rabbit, a poor citizen of Nottingham.  He has many siblings, including his older sister, Sis, and his baby sister, Tagalong.  Being just a boy, Skippy's a brave, adventurous and plucky little fellow who lives for adventure.  He has a general American accent.

During the movie he has just turned seven years old, and his family are throwing a birthday party for him.  The Sheriff of Nottingham, however, barges in on the party and, using his cheerful guile, convinces Skippy to open his present while he's watching.  When Skippy does this, the Sheriff confiscates his birthday present, a farthing*.  The Sheriff's cruel action brings the little boy to tears.  Mother Rabbit reprimands the Sheriff, noting that the while family scrimped and saved to give the farthing to him.  The Sheriff feigns sympathy for them, and then gives them empty encouragement.  But then Robin Hood, initially in disguise as an old, blind beggar (in order to fool the Sheriff), appears and saves Skippy's birthday by bringing presents to him, cheering he and his family up immeasurably.

Skippy absolutely idolizes Robin Hood, and hopes one day to be just like him (and perhaps, in the meanwhile, to be his sidekick).  When Robin presents him with a bow and arrow for birthday, and then his own cap, he makes Skippy not only supremely happy, but fosters in the young boy a growing desire to pretend that he IS Robin Hood, off on many harrowing and heroic adventures.  Skippy even helps Robin and Little John, and other citizens of Nottingham, in overthrowing Prince John and restoring King Richard to the throne of England.

And at the end of the movie, when Robin and Maid Marian are married, it is Skippy who joins them and Little John as they ride off down the road to London to begin their honeymoon, telling his friend Toby "well, Robin Hood's gonna have kids!  So somebody's gotta keep their eye on things."

Origins of the character: While there are no specific foundations for this character in the Robin Hood legends, Skippy does represent a sample of the average citizens of the village of Nottingham.

*It's worth noting that, in historical terms, the farthing coin was not first minted until after the deaths of King Richard and Prince (later King) John.  At least in historical terms.  Not terribly important from a movie perspective.