Bilbo standing outside his home, Bag-end, as illustrated by Alan Lee.

Now I am writing about the main character of the boook, which is the moderately young hobbit Bilbo Baggins. Bilbo Baggins is a rich hobbit, in fact, he is the most wealthy and respected hobbit in the entire Shire (which is the country of the hobbits, or land). He is quite happily living there in Bag-end, which his the name of his house. For there he has no worries at all, he'll just sit there in the garden, smoking the finest tobacco and eating all the spicecakes he wants while reading a fine book.
As mentioned, he is quite fine with his lazy way of life, not doing much, enjoying the cardinal pleasures of life.

But the wizard Gandalf, whom Bilbo has known for most of his life, one day stops outside his house and addresses Bilbo. He wants him to join himself and a party of 13 dwarves on an adventure. They wish to destroy the evil dragon Smáug and retrieve all the treasure which he has stolen from the dwarves over time.
Of course Bilbo wants no part in this fool's errand: A dragon? how silly, there is no such thing. But even so, it would be ridicuous to traverse entire middle-earth with a bunch of stranger dwarves in order to help them with some old quest.
But even with this thinking Bilbo feels a strange call he has never experienced before. He suddenly feels the call for adventure, and after alot of convincing from Gandalf (well not that much, he is a wizard after all) he decides to accompany the dwarves on their quest to the mountain edge of middle-earth.
And during this journey he converts from being a cowardly, chubby little hobbit into becoming a fearless, smug and tricksy rogue.

Picture is from http://fantasy.mrugala.net/Alan%20Lee%20-%20The%20Hobbit/Alan%20Lee%20-%20The%20Hobbit%20-%2015%20-%20Mr%20Bilbo%20Baggins.jpg