Pendejo is etymologically related to the Latin pectiniculus, meaning "pubic hair" or "anal hair". It may be translated as "asshole" in many situations, though it carries an extra implication of rank and willful incompetence. The less extreme version, which is used in most Spanish speaking countries translates more or less as "jackass". The term however, has very high offensive connotations in Cuba and Puerto Rico.
In Mexico, Central and Northern South America, pendejo refers to a stupid person, synonymous with idiota or dumbass, although it is a much stronger word in Mexico and Central America than it is in Panama, where, while still impolite, it is not as offensive, especially among younger people. In Peru it means a person who gains benefits from an advantageous situation in an immoral or deceptively persuasive manner (usually involving sexual gain and promiscuity, but not limited to it) and if it used referring to a female, ella es pendeja, means she is promiscuous (but the sense of female con-man can also apply). There the word "pendejada" and a whole family of related words have meanings that stem from these. In South America pendejo is also a vulgar, yet inoffensive word, for children. It also signifies a person with a disorderly or irregular life. In Puerto Rico and Dominican Republic, it has different meanings depending on the situation. It can range from Te cogieron de pendejo! = "You were fooled!" (e.g. by a con-man), to Qué tipa pendeja! = "What an asshole!" (as when some unknown woman unexpectedly offends you with no apparent motive, and just leaves turning her back on you). In Mexico and some countries of Central America, especially El Salvador, una pendejada is used to describe something incredibly stupid that someone has done. In many countries, "pendejo" also means coward (with a stronger connotation), as in No huyas, pendejo! = "Don't run away, chicken-shit!".
In Argentina and Chile, pendejo or pendeja refers to a child, usually with a negative connotation, like referring to immaturity.
In the Philippines, the word pendejo is a very offensive word meaning "cuckold". When said to a certain person, its intent is to degrade that man and rob him of his pride.