According to the Old Testament, Satan (or Lucifer, as he was called when he was an angel) was one of God's creations. Two Old Testament passages (Isaiah 14:12-15 and Ezekiel 28:11-19) allude to the angel Lucifer's original position as a very exalted being, and likely the highest ranking of all the angels. Ezekiel 28:12-15 also states that in addition to being powerful, it's likely that Lucifer was the most beautiful of all of God's creations.
But Lucifer was not satisfied with his lot in heaven as "God's favorite angel." Instead, Lucifer wanted to become God himself and planned what could essentially be called a military coup to overthrow God and take over as leader of the universe. In essence, Satan rebelled against God because he wasn't happy as an assistant to God but instead wanted to have God's job.
According to the Old Testament, upon learning of Lucifer's plan, God removed him from his dignified position and cast him out of Heaven (Isaiah 14:15; Ezekiel 28:16-17). This is often described as Satan's "fall from Heaven," although it's probably more accurate to say that he was exiled from Heaven.
Interestingly, in the Old Testament, when Satan tempts Adam and Eve in the Garden of Eden, he does so using the promise of God-like powers. In Genesis 3:1-5, as Satan tempts Eve to eat the fruit of the Tree of the Knowledge of Good and Evil, he tells her, "For God doth know that in the day ye eat thereof, then your eyes shall be opened, and ye shall be as gods, knowing good and evil."
Satan convinces Eve to eat the fruit by telling her that after doing so, she will know what God knows.