The origins of the Yakuza are said to date back to the 1600s when the 'Kabukimono' ("crazy ones") took the street. They were eccentric samurai, wearing odd, flamboyant clothing and hairstyles and speaking in overly aggressive slang. Often self-aggrandizing and fond of picking fights with locals, they were fiercely loyal to each other.
Yakuza origin stories often claim Yakuza to be servants of the people, rejecting their Kabukimono origins to suggest instead that they fought against the Shogunate and its cruelty, and not with it. This sense of piety and loyalty to traditional values are foundational to Yakuza culture. The yakuza are, roughly speaking, the Japanese equivalent of the Mafia. After the Kabukimono, much of their organization, traditional jobs and style can be said to come from two other Tokugawa groups: the Bakuto (gamblers), and the Tekiya (peddlers).
Respected members are often heavily tattooed, for a number of reasons. First, because of their Bakuto origins. Second, because it is a sign of strength. Third (and this reason is the most prevalent one in modern times), because it signifies affiliation. Modern Yakuza tattoos are complex traditional pieces telling stories of origin, gang affiliation and personality. While the stereotype prevails that all Yakuza are heavily tattooed and that any heavily tattooed Japanese person is Yakuza, this is far from the case. Yet, even today, wearing tattoos out in public in Japan will associate you with a rough crowd, and having tattoos may deny you entry from some Onsen, hotels, or bars.
While Yubitsume (elective amputation of finger joints) was an encouraged practice of penitence within gangs for wrongs done, due to social taboo and increasingly restrictive measures taken against organized crime in Japan, the practice is falling out of favor among younger members. Some Yakuza engage in Pearling, with each pearl being said to represent one year in prison (which is why some people call genital implants "Yakuza Beads").
In the modern social order, most Yakuza first engage in a rebellious lifestyle in junior high and high school, joining one of many youth-oriented subcultures of Japan, most notoriously in the past twenty years of Bosozoku or Yankee culture. This introduction to petty crime is hierarchical in structure, with older members often "graduating" into Chinpira positions for the Yakuza. Punk culture is another recruiting ground for Yakuza, as punks within the restrictive Japanese social order get heavily tattooed American Old school tattoos, and subsequently find themselves unable to get work anywhere else.
Extreme Yakuza in full Horimono and punch perms are still very much a staple of popular culture. However, the reality of the Yakuza and the amount of influence they have in Japan is not as entertaining. Yakuza run everything from gambling, loan sharks, sex clubs and bars, concert venues and pop stars. They have stock in billion-dollar corporations and occasionally work with the Japanese government on special projects such as strong arms. Many older Yakuza represent businessmen more than Guitar Wolf, and while they do provide an outlet for work for social outcasts and the heavily modified, at the same time they play a key role in the Nationalist agenda that creates the hegemonic structure of Japan.