Short answers, pulled from the story.
The Shire is an inland region in J. R. R. Tolkien's fictional Middle-earth, settled exclusively by hobbits. It is located in the northwest of the continent, in the region of Eriador and the Kingdom of Arnor, and measures 40 leagues east to west and 50 leagues north to south, roughly the area of the English Midlands.
Five protagonists across Tolkien's stories come from the Shire: Bilbo Baggins, the title character of The Hobbit, and four members of the Fellowship of the Ring: Frodo Baggins, Samwise Gamgee, Merry Brandybuck, and Pippin Took. Bilbo and Frodo both lived at Bag End in Hobbiton.
Tolkien based the Shire on the rural English counties of Worcestershire and Warwickshire, where he grew up. He equated the latitude of Hobbiton with that of Oxford, and drew on his childhood at Sarehole for the Shire's feel of unmechanized farmland, gardens, and English village life.
The Shire was filmed at a farm near Matamata in New Zealand, owned by Ian Alexander. After filming The Fellowship of the Ring and The Return of the King, 18 of 37 hobbit-holes could not be immediately demolished due to bad weather, and the site attracted over 12,000 tourists per year before the set was fully cleared. Jackson returned to the same location for The Hobbit films.
The Shire was first settled by hobbits in the year 1601 of the Third Age, which became Year 1 in Shire Reckoning. It was founded by two brothers, Marcho and Blanco, who led hobbits from the vale of Anduin westward over the Misty Mountains into the region of Eriador.
The Scouring of the Shire is the chapter near the end of The Lord of the Rings in which Frodo, Sam, Merry, and Pippin return home to find the Shire controlled by Saruman's ruffians, acting through his underling Lotho Sackville-Baggins. The hobbits liberate the Shire at the Battle of Bywater, the final battle of the War of the Ring. Tolkien partly based the industrialization in the chapter on the spread of Birmingham's heavy industry into the Worcestershire and Warwickshire countryside he had known as a child.