Usually, the word cute is used to mean something that is attractive to look at, especially for prettiness or daintiness, often engendering a feeling of protectiveness in the viewer. In other words, a cute thing makes you go "awww!" Cute things are usually small, like baby animals with big eyes; or they resemble small things, like a young adult with a baby-face. You wouldn't call them handsome or beautiful, exactly, but they're cute! Things with a high cuteness factor have a high level of adorability.
However, cuteness is extremely subjective. One person's "awww" is often another's "oh god I'm gonna hurl," especially if the agent of cuteness (e.g. smallness, fluffiness, giant eyes, the color pink) is exaggerated beyond reasonable proportions. This is why agents of the PPC often retch at the sight of Cute Animal Friends, which tend to try way too hard and become sickening rather than cute. This is also why some agents are very affectionate toward their minis or other things that really should not be considered cute by anyone ever. There's just no accounting for taste.
Cuteness may be regarded as evil by some agents. They should be kept away from all valued pets, toys, and small children. Even if they may be right (see image).