There are meant to be two types of ghoul:
The first type are those that used be normal villagers, possibly in the empire for example. In times of famine they turned to the only food source left - other humans. As this went on, combined with inbreeding etc they devolved into Ghouls.
The second, was a race of humans who took to worshipping Nagash when he came to Cripple Peak. Because they feared him, they started worshipping as a god. He quite liked this, and made them carry out the ritual of the Dark Feast - eating human flesh tainted with warpstone. This eventually caused the civilisation to devolve.
From the fluff I've read, they retain a small amount of intelligence, say that of a small child. They can hunt, know dangerous situations, can manipulate easy things like door handles. However they have no sense of reasoning, and a purely driving by animal instincts, i.e eating, sex etc. Because of this weak personality, they can be easily controlled by vampires.