Stereotype comes from Greeks words stereos (firm, solid) and typos (impression), thus stereotype is “solid impression”. Firstly used in the world of printing referring to a duplicate impression of an original typographical element, used for printing instead of the original (wikipedia). Later an American Journalist, Walter Lippmann, used it as metaphor.
Based on Cambridge Advance Learner’s Dictionary, stereotype (n) is a fixed idea that people have about what someone or something is like, especially an idea that is wrong. Another source defines stereotype as an exaggerated belief about a group often based on a lack of information or contact with members of that group (Levine and Adelman, 1993).
Stereotype is different with generalize; we can say it is overgeneralize of something. When we generalize a group means we describe the common behavior within the group but we can assume that everyone in the group has it. While in overgeneralize a group we will judge that everyone in the group shares same behavior based on observation over some people in the group.
The ideas or stereotype can be either positive or negative. When we say fat guys good at singing it is a positive stereotype, but women can’t read maps it is a negative stereotype. Find my example not good enough? Feel free to give more examples in your comment(s). :-)
To conclude, stereotype is exaggerate idea of a group without enough information and the idea usually wrong. It can be either positive or negative but usually it is in negative way since people tend to put “we” superior than “they”.