There are many legends and stories that speak of the Chinese Zodiac and it's origins, some more common then others.

According to one legend, in the sixth century B.C. the Jade Emperor invited all the animals in creation to a Great Race, although only twelve showed up: the Rat, Ox, Tiger, Rabbit, Dragon, Snake, Horse, Lamb, Monkey, Rooster, Dog, and Pig, and according to their places in the race, the Jade Emperor had given them each a number starting with the Rat who was the winner of the race.

According to the legend a Cat was also present in the race, and would have finished first if not from been betrayed by his friend, the Rat.
The story of the race, and why the Cat and the Rat are renown enemies is shown below.

The cat and the rat were the worst swimmers in the animal kingdom. Although bad swimmers, they were both intelligent. They decided that the best and fastest way to cross the river was to hop on the back of the ox. The ox, being a naïve and good-natured animal, agreed to carry them across. However, overcome with a fierce competitiveness, the rat decided that in order to win, it must do something and promptly pushed the cat into the river. Because of this, the cat has never forgiven the rat, and hates the water as well. After the ox had crossed the river, the rat jumped ahead and reached the shore first, and it claimed first place in the competition.

Following closely behind was the strong ox, and it was named the 2nd animal in the zodiac. After the ox, came the tiger, panting, while explaining to the Emperor just how difficult it was to cross the river with the heavy currents pushing it downstream all the time. But with powerful strength, it made to shore and was named the 3rd animal in the cycle.

Suddenly, from a distance came a thumping sound, and the rabbit arrived. It explained how it crossed the river: by jumping from one stone to another in a nimble fashion. Halfway through, it almost lost the race but the rabbit was lucky enough to grab hold of a floating log that later washed him to shore. For that, it became the 4th animal in the zodiac cycle. Coming in 5th place was the dragon, flying and belching fire into the air. Of course, the Emperor was deeply curious as to why a strong and flying creature such as the dragon should fail to reach first. The mighty dragon explained that he had to stop and make rain to help all the people and creatures of the earth, and therefore he was held back a little. Then, on his way to the finish line, he saw a little helpless rabbit clinging on to a log so he did a good deed and gave a puff of breath to the poor creature so that it could land on the shore. The Emperor was very pleased with the actions of the dragon, and he was added into the zodiac cycle. As soon as he had done so, a galloping sound was heard, and the horse appeared. Hidden on the horse's hoof is the snake, whose sudden appearance gave the horse a fright, thus making it fall back and gave the snake 6th spot while the horse took the 7th.

Not long after that, a little distance away, the ram, monkey and rooster came to the shore. These three creatures helped each other to get to where they are. The rooster spotted a raft, and took the other two animals with it. Together, the ram and the monkey cleared the weeds, tugged and pulled and finally got the raft to the shore. Because of their combined efforts, the Emperor was very pleased and promptly named the ram as the 8th creature, the monkey as the 9th, and the rooster the 10th.

The 11th animal is the dog. His explanation for being late—although he was supposed to be the best swimmer amongst the rest—was that he needed a good bath after a long spell, and the fresh water from the river was too big a temptation. For that, he almost didn't make it to finish line. Just as the Emperor was about to call it a day, an oink and squeal was heard from a little pig.
The pig got hungry during the race, promptly stopped for a feast and then fell asleep. After the nap, the pig continued the race and was named the 12th and last animal of the zodiac cycle.
The cat finished too late (thirteenth) to win any place in the calendar, and vowed to be the enemy of the rat forevermore.

However, the origins go back much further then the time of the Great Race, with records of the Twelve Early Branches, of which the animals relate too, documenting as far back as the Zhou Dynasty (1122–256 BC) - Although some argue against this.
Derek Walters, a British scholar and author of several books about the Zodiac, is one of these who argue the animals relation to the Twelve Early Branches - He says there  is no historical evidence for the 12 animals correlation with the Earthly Branches prior to the late Tang Dynasty (618–907), early Song Dynasty (960–1279) eras.

In practice the real explanation for the choices of the positioning of the 12 Zodiac animals was based on the number of toes/hooves, alternating between even and odd numbers. Rat was the first because unlike other animals of the Chinese zodiac which all had the same number of toes/hooves on each leg, the rat has four toes on the front legs and five on the rear legs, so it was selected to be number one. Ox is second with four hooves on each leg, and tiger is the third with five toes. The hare is the fourth with four toes, dragon is next in line with five fingers on its claw, while snake ranks number six because it lacked any legs and zero is an even number, etc.

7th February, 2008 marks the year of the Yang Earth Rat
Although with Earth been the equivalent of the colour brown 2008 is also called the Brown Rat year.

The Chinese New Year starts on the first day of the new year containing a new moon and ends on the Lantern Festival fourteen days later. This occurs around the time of the full moon as each lunation is about 29.53 days in duration. In the Gregorian calendar, Chinese New Year falls on different dates each year, a date between January 21 and February 20 - In 2009 the Festival still fall on January 26th.
This means that the holiday usually falls on the second (very rarely third) new moon after the winter solstice.

Solstices occur twice a year, when the tilt of the Earth's axis is oriented directly towards or away from the Sun, causing the Sun to appear to reach its northernmost and southernmost extremes. The name is derived from the Latin sol (sun) and sistere (to stand still), because at the solstices, the Sun stands still in declination; that is, its apparent movement north or south comes to a standstill.

The Chinese record their yearly history from the first king of China; The Yellow King who was crowned in what we call 2697 BC.
We calculate the year using the Chinese Sexagenary cycle which is a cyclic numeral system of 60 combinations of the two basic cycles; the ten Heavenly Stems and the twelve Earthly Branches. These have been traditionally used as a means of numbering days and years, not only in China but also in other East Asian nations like Japan, Korea, and Vietnam.

The actual formula is to take the value of the Sexagenary cycle, 60; and times it by the number of times 60 years has passed since 2697 in this has 78.  60*78=4680; plus 25, the current year of the Sexagenary cycle to give us the value 4705.
The easier method however is to take 2697 as a base value, and add the value of the current year of our Gregorian Calendar.
Regardless of the method to find the year, the Chinese New Year in February will mark the 4705th Chinese Year.

As mentioned above, when the new year begins we will be on Year 25 of the 60 Year Sexagenary cycle, which began in 1984.

Now, before I go on to explain more in-dept about the animal signs of the Zodiac, I'll explain each Yearly animal, including dates so you can look to work out your own Zodiac Animal and see how you match to it's descriptions.

Personally, I'm born under the sign of the Rabbit, and the description is quite accurate! ~Therian

Rat Those born under the sign of the Rat are usually intelligent, charming, ambitious – and often successful in business. They are quick to spot potential and put their creative, clever ideas into effect. At times they may appear stubborn, selfish and greedy, as they approach things wholeheartedly. They are energetic and great organizers, so if you want something done call in a Rat. They are suited to careers in shop-keeping, sales, buying and selling, or accountancy and shine in Management Positions. As an animal, Rats are very intelligent creatures; The Ancient Chinese wouldn't board a ship if it were not infested with rats, as it was believed they wouldn't board a ship that had a risk of sinking from any danger. Years: 1936, 1948, 1960, 1972, 1984, 1996, 2008, 2020.

Ox Those born under the sign of the Ox are steady, honest, gentle and reliable. The Ox builds plans and ideas on firm ground. Patience and hard work bring success to the Ox. They need peace and quiet to work through their ideas and are best left alone to work as they can become hot-headed, inflexible and stubborn when pushed. - They are logical and find it hard to forgive if deceived and prefer a truthful, loyal and committed partner. They work well in careers to do with the earth, visual arts, farming, estate management, cooking, religion and medicine and are often very skilled with their hands. Security is their main preoccupation in life, and they are prepared to toil long and hard in order to provide a warm, comfortable and stable nest for themselves and their families. Years: 1937, 1949, 1961, 1973, 1985, 1997, 2009, 2021.

Tiger Those born under the sign of the Tiger are usually determined, enthusiastic and positive with a sense of superiority. Tigers explore the potential in unlikely situations. They like to see everything settled, rarely abandon projects and will become self centered and obstinate if they fail to achieve. Tigers tend to place themselves in leadership or radical roles. They may become aggressive if trapped. In love, they need a steady consistent partner who quietly gets on with their own life. They are born leaders, are suited to travel, designing, advertising, politics or the military. Years: 1938, 1950, 1962, 1974, 1986, 1998, 2010, 2022.

Rabbit Those born under the sign of the Rabbit are usually generous, friendly and tranquil by nature. Rabbits like everything to be low key and even tempered and are anxious if forced to take risks. They enjoy paying attention to detail to create an ambience in their lives. Rabbits most often prefer the easy road. There ideal partner is loving and kind hearted and always makes a good attempt to fulfill their partner's desires. Rabbits are suited to careers in literature, art, design, public relations, counselling, advisory occupations and law. They also make good secretaries. Years: 1939, 1951, 1963, 1975, 1987, 1999, 2011, 2023.

Dragon Those born under the sign of the Dragon have a personality that is is energetic, enthusiastic and self-confident and good at creating an impression. Dragons are interested in the world around them, full of energy and are comfortable with being the centre of attention. In difficult situations, they can judge well, stepping in at the right moment to resolve things. They can be decisive, lucky and capable yet quiet serious and dignified - They can also be brave and charismatic and have a whole hearted approach to life. They see themselves as protectors. In partnerships they look for someone who will give them space and at the same time satisfy their romantic nature. Their careers can be in acting, law, religion, management and the arts. Enjoying responsibility, they will not tolerate being trapped in poor jobs or being at the mercy of others. Years: 1940, 1952, 1964, 1976, 1988, 2000, 2012, 2024.

Snake Those born under the sign of the Snake always try be in control, are charming and captivating, yet calculating and often conservative. They are often enduring characters who can keep going in adversity. They have the alertness of the snake and often exhibit uncanny perception. Companionship, moral support and love are important to a Snake in intimate relationships. Their partners must like cosy surroundings and intimacy. They are brilliant at laying in wait and may patiently observe for months or years, then strike at the right moment. Their careers are in public relations, archaeology, astrology, philosophy, catering or the law. Years: 1941, 1953, 1965, 1977, 1989, 2001, 2013, 2025.

Horse Those born under the sign of the horse tend to be very independent and confident, but also full of strength and ambitious, but also very honest and loyal. They set out to achieve recognition for their skills and often turn out to be totally devoted to their work, family or home. Even in the face of crises, Horses have a tendency to go forward which is a sign of their tremendous inner confidence.  They are willing to do their very best and are usually devoted to whatever they focus on. They are often very devoted to their tasks and need a partner who will take care of them but will also leave them free to pursue their own adventures if needed. In careers they will make good politicians, explorers and artists. Years: 1942, 1954, 1966, 1978, 1990, 2002, 2014, 2026.

Sheep Those born under the sign of the Sheep are considered patient and like to exercise moderation and caution in all aspects of their lives though they can bear great pressure and remain stable when something in life calls for them to do so. Can be very hard workers accomplishing much and can easily take on more than their load. Often they will remain in the background of an endeavor not needing to hog the limelight. Sheep generally make good team workers and their steadfastness makes them very reliable. In love they tend towards a partner who will protect them and give them space for their creativity. They can have careers in the arts, research, outdoor work, emergency relief work, in libraries or in design. Years: 1943, 1955, 1967, 1979, 1991, 2003, 2015, 2027.

Monkey Those born under the sign of the Monkey are said to hold an inner spirit of lightning energy. They have a mental gift of being intelligent and learning quickly, they come up with new ideas and like to learn new things. They love playing games and are often ready to tease or play tricks. Their fast moving energy makes them sometimes appear insensitive to others so often for this reason they find it hard to settle with one person. Often Monkeys find themselves born into families that support them well. They can be very ambitious and adaptable. In career they are good at design, media management, public relations and planning. Years: 1944, 1956, 1968, 1980, 1992, 2004, 2016, 2028.

Rooster Those born under the sign of the Rooster are said to be very courageous, brave and wise. They enjoy singing and music and can be very creative and often have very powerful imaginations. They have a strength of persistence and often exhibit strong personal power usually knowing what they want. Are very good talkers and can persuade others. In relationships they frequently yearn for companionship or friendship and make astute observers of what happens in a partnership. In career they can be adept in politics, public relations, arts, creative work, and scientific endeavours. Years: 1945, 1957, 1969, 1981, 1993, 2005, 2017, 2029.

Dog This is the honest, friendly and sincere sign of the zodiac. People born under the Dog always seem to be ready for action and this quality brings respect from others around them. They can be brave and courageous and rarely withdraw from a commitment or betray a confidence. Their inner power and physical vigour makes them good people to have on a team. They are very loyal and reliable and in relationships settle with someone who supports them. They are devoted to the welfare of others and are often wonderful listeners. They can be very faithful to their partners and to others around them. The careers that they approach include teaching, social work, counselling, medicine, research, public campaigning and law. Years: 1946, 1958, 1970, 1982, 1994, 2006, 2018, 2030.

Pig Those born under the sign of the Pig are tolerant and generous, virtuous and peaceful. They are well liked for their honesty and warm natures. They aim to find the best in people and allow others plenty of freedom of expression and are often imbued with the energy of wealth and the support of others, though they are not concerned with accumulating wealth. They can be content with modest means and rarely criticise others and are not vengeful and thus have few enemies. The Pig accepts the existing richness of life and doesn't demand more. They enjoy simple and earthy pleasures. In relationships they give love and affection and trust that they will receive the same. They possess considerable determination and if they set their minds on something will pursue it and attain it. Good careers are in music, food, writing, social work, gardening and looking after others. Years: 1947, 1959, 1971, 1983, 1995, 2007, 2019, 2031.

All Images above are sourced from their respective sections seen in the Wikipedia Article: Origins of the Chinese Zodiac

The 60-year cycle consists of two separate cycles interacting with each other. The first is the cycle of ten heavenly stems, namely the Five Elements (in order Wood, Fire, Earth, Metal, and Water) in their Yin and Yang forms, commonly viewed as Male and Female.

The second is the cycle of the twelve Zodiac animal signs or Earthly Branches . They are in order as follows: the rat, ox, tiger, rabbit, dragon, snake, horse, sheep, monkey, rooster, dog, and boar.

This combination of 5 elements × 12 animals creates the 60-year cycle, which always starts with Wood Rat and ends with Water Boar. Since the zodiac animal cycle of 12 is divisible by two, every zodiac sign can also only occur in either yin or yang: the dragon is always yang, the snake is always yin, etc. The current cycle began in the year 1984, and will complete in 2043.

When trying to calculate the relevant year, an easy rule to follow is that years that end in an even number are yang, those that end with an odd number are yin. The cycle proceeds as follows:

If the year ends in 0 it is Yang Metal	If the year ends in 1 it is Yin Metal
If the year ends in 2 it is Yang Water	If the year ends in 3 it is Yin Water
If the year ends in 4 it is Yang Wood	If the year ends in 5 it is Yin Wood
If the year ends in 6 it is Yang Fire	If the year ends in 7 it is Yin Fire
If the year ends in 8 it is Yang Earth	If the year ends in 9 it is Yin Earth

Aside from each of us been born with a Zodiac Symbol we are also aligned with a particular Element.
A person born in 1970 for example would be born in the Year of the Dog, with an element of Metal.

These elements have a a major bearing on what is beneficial and effective for a person in terms of their feng shui, the Chinese form of geomancy - Or rather how the stars and planets effect their luck over the years.

The elements also govern various aspects of a persons personality,
and are assigned to various other things such as directions, colours, seasons and planets.

It is also suggested that according to your Zodiac's governing element you may be lucky or very unlucky in accordance to the year.
2008 for example is the Brown Rat year, Brown is earth, while Rat is Water - Two elements that are attracted to each other.
If your Zodiac is governed by either of the two elements then you will be in for a lucky year,
Although perhaps not the best since the two are opposite elements.

Wood

The Zodiac Animals of Wood include the Tiger, Rabbit and Dragon. They are linked to the direction East, and favour the Spring.
The Planet Jupiter is their source of strength, and they have a deep connection with the colour Green.
They are usually Generous, Warm, Persuasive, Co-operative and Seek to Expand and Grow.
The characteristics of the Wood element usually mean those born under the sign are Idealistic, Ethical, Enthusiastic and love to Explore.

Fire

The Zodiac Animals of Fire include the Snake, Horse and Sheep. They are linked to the direction South, and favour the Summer.
The Planet Mars is their source of strength, and they have a deep connection with the colour Red.
They are usually Dynamic, Humanitarian, Energetic, Passionate, Enterprising, Adventurous and Restless.
The characteristics of the Fire element usually mean those born under the sign are Competitive, but usually have good Leadership Skills, are Strong, but Single-minded, but they do enjoy a good laugh.

Water

The Zodiac Animals of Water include the Pig, Rat, Ox. They are linked to the direction North, and favour the Winter.
The Planet Mercury is their source of strength, and they have a deep connection with the colour Black.
They are usually Secretive, but Charming, Intuitive, Compassionate and Sensitive and very Creative.
The characteristics of the Water element usually mean those born under the sign are Flexible, Compliant, Eloquence and Intellectual.

Metal

The Zodiac Animals of Metal include the Monkey, Rooster and Dog. They are linked to the direction West, and favour the Autumn.
The Planet Venus is their source of strength, and they have a deep connection with the colour White.
They are usually Determined, Self-reliant, Unyielding, Strong, Tenacious and somewhat Forceful.
The characteristics of the Metal element usually mean those born under the sign are Reserved within themselves but very Sophisticated, caring and respectful of others while seeking pleasure. They do however need some personal space from time to time.

Earth

Unlike the others Earth governs no Zodiac Animal, but at the same time governs them all been that it's qualities can be seen on them all. They are linked to the Centre of directions, and favour no particular season.
The Planet Saturn is their source of strength, and they have a deep connection with the colour Yellow.
Their qualities mean they are usually Patient, Militaristic, Prudent, Stable, Reliable, Hard-working and Ambitious.
They are also very energetic, but sometimes Stubborn.
Disciplince, Tenacious and Logical Thought are usually characteristics of Earth, along with a duty to others governed by service.

 

Even deeper then the elements of the Zodiac Animals are two more sets named the Inner Animals, and Secret Animals.
These are all named after the Zodiac, but dwell further into the Month, and Hour or their birth.

A person may appear to be a Dragon on the outside from been born on the Year of the Dragon, however they may also be a Snake internally from been born between the 5th of May, and the 5th of June, and a Tiger secretly from been born between 3 and 5am.

The Inner Animals as you may have guessed are based upon the Month that we are born.
Now, the first month, the Tiger Month actually begins on the 4th of February; which is actually the New Year.
Celebrations often take place before or after this date.

The Inner Animals are governed by the traditional Chinese agricultural calendar, which runs alongside the better known lunar calendar. Instead of months, this calendar is divided into 24 two week segments known as Solar Terms. Unlike the 60 year lunar calendar, which can vary by as much as a month in relation to the Western calendar, the agricultural calendar varies by only one day, beginning on the Western February 3rd or 4th every year, and unlike the cycle of the lunar years, which begins with the Rat, the agricultural calendar begins with the Tiger as it is the first animal of spring.

An individual's monthly animal sign is called their inner animal and is concerned with what motivates a person. Since this sign dictates the person's love life and inner persona, it is critical to a proper understanding of the individual's compatibility with other signs.

The Weeks of the agricultural calendar are all based on the Solar Longitude of the Sun during different times of the year.

Solar Longitude	Solar term (Week Name)	Western Date	Lunar Month
314°	Lìchūn	Feb 04 - Feb 18	Tiger
329°	Yŭshuĭ	Feb 19 - Mar 05
344°	Qĭzhé	Mar 06 - Mar 20	Rabbit
0°	Chūnfēn	Mar 21 - Apr 04
14°	Qīngmíng	Apr 05 - Apr 19	Dragon
29°	Gŭyŭ	Apr 20 - May 04
44°	LìxiÃ	May 05 - May 20	Snake
59°	Xiăomăn	May 21 - June 05
74°	Mángzhòng	Jun 06 - Jun 20	Horse
89°	Xiàzhì	Jun 21 - Jul 06
104°	Xiăoshŭ	Jul 07 - Jul 22	Sheep
119°	Dàshŭ	Jul 23 - Aug 06
134°	Lìqiū	Aug 07 - Aug 22	Monkey
149°	Chùshŭ	Aug 23 - Sep 07
164°	Báilù	Sep 08 - Sep 22	Rooster
181°	Qiūfēn	Sep 23 - Oct 07
194°	Hánlù	Oct 08 - Oct 22	Dog
211°	Shuāngjiàng	Oct 23 - Nov 06
224°	Lìdōng	Nov 07 - Nov 21	Pig
244°	Xiăoxuě	Nov 22 - Dec 06
251°	Dàxuě	Dec 07 - Dec 21	Rat
271°	Dōngzhì	Dec 22 - Jan 05
284°	Xiăohán	Jan 06 - Jan 19	Ox
301°	Dàhán	Jan 20 - Feb 03

And as previously mentioned there is also the Secret Animals, which are related to the time of your birth.
 

23:00 - 01:00	Pig
01:00 - 03:00	Ox
03:00 - 05:00	Tiger
05:00 - 07:00	Rabbit
07:00 - 09:00	Dragon
09:00 - 11:00	Snake
11:00 - 13:00	Horse
13:00 - 15:00	Sheep
15:00 - 17:00	Monkey
17:00 - 19:00	Rooster
19:00 - 21:00	Dog
21:00 - 23:00	Pig

Using all of the above tables you can even find your own Zodiac Animal, your Inner Animal, and perhaps even your Secret Animal.

If your interested into reading further about the Chinese Zodiac then you can find a great deal of information across a number of locations - A simple version with pictures to help empathise the wording can be found on the Chinese Fortune Calender website. http://www.chinesefortunecalendar.com/2008.htm