Bilbo Baggins, hobbit of the Shire, was born in TA 2890. He went down in history as a poet, a writer, a translator from elvish and the author of one of the parts of the Red Book of Westrmarch. In TA 2941 he along with Torin Oakenshield and other twelve dwarves went to Erebor, the Lonely Mountain, to reclaim the treasures stolen by Smaug, the dragon. His reliable fellow-traveler was a wizard Gandalf the Grey. The journey changed Bilbo a lot - he became a brave and respected hobbit. Bilbo Baggins was the key figure of the journey. If it had not been for him, Smaug would have remained in the dwarves' caves with a huge pile of gold.
Bilbo Baggins played an important role in the life of Middle-earth. It was he who found the One Ring in a cave under the Misty Mountains, which caused the War of the Ring some decades later.
It should be noted that Bilbo was rather a lucky hobbit. Having embarked on a dangerous journey with the dwarves, at first he as if accidentally fought with enemies and only thanks to luck he came out victor. Little by little, Bilbo learned how to twist any enemy round his finger.
Bilbo was an honest and decent hobbit. He told lies, or, better say, white lies only to his enemies. He was unselfish and even resigned his share of gold. In no way Bilbo could be called mean, considering an episode with a theft of the Arkenstone, the most precious gem of Erebor. Having handed it over to Gandalf, Bard and the King of the Elves, he equalized the strength of the opponents and tried to reconcile dwarves who didn't want to share gold with the men of Esgaroth. All ended happily and Bilbo Baggins came back to the Shire with a descent amount of gold, which he had found in a troll's cave. "The Hobbit" narrates Bilbo Baggins' adventures at great length.
When Bilbo came back to the Shire he was considered an owner of a glut of wealth, which was exaggerated to some extent. Bilbo didn't suspect that the most valuable thing would turn out to be a magic ring, which was able to make its master invisible.
In TA 2980 Bilbo adopted his orphaned nephew, Frodo, and 31 years later announced him his heir, having aroused extreme envy in his other relatives. In TA 3001 Bilbo decided to celebrate his 111 birthday throwing a great feast. Before the celebration in his talk with Gandalf, Bilbo confessed that he got pretty tired and wanted to have a rest; but he wanted to see his relatives and fiends for the last time.
Some dwellers of the Shire considered Bilbo extremely strange, the others - weird. His trick with disappearing on his birthday added fuel to the fire. But Bilbo decided to retire from everyday chores and move to Rivendell. This is how Tolkien described Bilbo before his departure: "He took off his party clothes, folded up and wrapped in tissue-paper his embroidered silk waistcoat, and put it away. Then he put on quickly some old untidy garments, and fastened round his waist a worn leather belt. On it he hung a short sword in a battered black-leather scabbard. From a locked drawer, smelling of moth-balls, he took out an old cloak and hood. They had been locked up as if they were very precious, but they were so patched and weatherstained that their original colour could hardly be guessed: it might have been dark green. They were rather too large for him."
It was difficult for Bilbo to leave the Ring behind. No doubt, it prolonged his life, but tempted him every now and then. When talking about the Ring, Bilbo strikingly changed, became angry and aggressive. When talking with Gandalf, he called the Ring "my precious" as Gollum did once. It was a terrible ordeal for him to see the Ring again in Rivendell.
In the abode of Elrond Bilbo did a lot of thinking, finished writing the Red Book of Westmarch, composed verses and songs, but most of the time he slept, for old age made itself felt. At the Council of Elrond, Bilbo volunteered to bring the One Ring to Orodruin, although everyone knew he wouldn't be able to do that. Behind this brave act, was an urge to destroy the Ring.
After the end of the War of the Ring in TA 3021 Bilbo Baggins decided to sail over the Sea to Valinor.
Bilbo Baggins went down in history of the Shire as a long-liver for he lived as long as 131 years and 8 days. He and Frodo were Tolkien's favorite characters and probably Tolkien gave some of his traits to Bilbo, like a love for pipe, yarning for quietness and tranquility.