RTFA: http://catb.org/~esr/jargon/html/B/back-door.html

Ken Thompson’s 1983 Turing Award lecture to the ACM admitted the existence of a back door in early Unix versions that may have qualified as the most fiendishly clever security hack of all time. In this scheme, the C compiler contained code that would recognize when the login command was being recompiled and insert some code recognizing a password chosen by Thompson, giving him entry to the system whether or not an account had been created for him.

Normally such a back door could be removed by removing it from the source code for the compiler and recompiling the compiler. But to recompile the compiler, you have to use the compiler so Thompson also arranged that the compiler would recognize when it was compiling a version of itself, and insert into the recompiled compiler the code to insert into the recompiled login the code to allow Thompson entry and, of course, the code to recognize itself and do the whole thing again the next time around! And having done this once, he was then able to recompile the compiler from the original sources; the hack perpetuated itself invisibly, leaving the back door in place and active but with no trace in the sources.The Turing lecture that reported this truly moby hack was later published as “Reflections on Trusting Trust”, Communications of the ACM 27, 8 (August 1984), pp. 761–763

“We’re not worthy! We’re not worthy! We’re scum! We suck!” –Wayne and Garth