Hot hatch was originally an informal automotive industry term, shortened from hot hatchback, initially coined by the European motoring press, for a high-performance derivative of a car body style consisting of a three- or five-door hatchback automobile. However, 'hot hatch' is now commonly and widely accepted as a mainstream, if still informal term.
The term is more popular in Europe, due to the popularity of the hatchback configuration. Within the United States, they are commonly named sport compacts, however, this deviates from the original meaning of the 'hot hatch' terminology (because they do not adhere to the 'hatchback' body style).
Vehicles of this class are typically based on family-oriented automobiles, and are equipped with an uprated more powerful internal combustion engine, improved suspension, and may also include additional 'aerodynamic' body parts. Front-mounted petrol engines, together with front-wheel drive, is the most common powertrain layout, although diesel-powered hot hatches are also available.
The design most often considered to have started the 'hot hatch' genre is the 1977 Volkswagen Golf GTI, although some consider the first true hot hatch to be the 1964 Renault 8 Gordini, with others having another point of view.[1] The Renault 5 Alpine (1972) also pre-dated the Golf GTI.
The original 1974 version of the Golf was in mass production at this point, and the addition of a higher performance 1.6 litre fuel injected engine, sharper handling, and sports-focussed marketing - found the birth a huge market for small, practical cars that still had excellent performance. The Golf GTI enjoyed a short run of unparalleled success, but by the early 1980s, car manufacturers worldwide were racing to market with their own alternatives. Notable big-sellers in the early days were the Peugeot 205 GTI, Ford Escort XR3i, (and Vauxhall Astra GTE in United Kingdom).
By the end of the 1980s, the hot hatch had taken its place across Europe, and was pushing into other worldwide markets. The brief heyday of Group B rallying pushed the hot hatch genre to its limits, and small numbers of ultra-high performance variants were manufactured to comply with the rally rules (often termed "homologation specials"). These enthusiasts vehicles represented a brief, extreme branch of the hot hatch, and included such notable vehicles as the Peugeot 205 T-16 and MG Metro 6R4.
So it's european, small, and hatch. Typically FWD although doesn't appear to be exclusive