Olaf the Troll God's enchanted hammer was a powerful weapon brandished by Olaf when Aud cursed him by turning him into a Troll.
Anya noted that the hammer contained his godly power. Buffy Summers used it to pummel Glory, a near-invulnerable hell-goddess, into submission.
The hammer was apparently very heavy. Despite having enhanced strength as a vampire, Spike was unable to lift it, but Buffy was able to wield it easily.
Behind the Scenes
The hammer was sold on eBay by Fox Auctions in 2004. As of September 2010, it was once again on sale, but has since been sold to an unknown buyer.
Olaf's Hammer might be based off Mjölnir, the hammer of Thor, the Norse God of Thunder.
The hammer was seen briefly in "Selfless" when Olaf just became a troll, so he was hardly a "troll god" by that time. This implies that the hammer may have at some point been imbued with godly power inbetween the time of Aud's curse and Olaf's imprisonment.
The hammer is not seen past "The Gift", even though it may have come in handy in future battles. It's likely that the Scooby Gang didn't recover the hammer after Buffy's death (since none of them could possibly lift it) and would have been too preoccupied with that tragic event.
Xander is seen taking direct blows from the hammer in "Triangle" (before Olaf was revealed to be a god) and surviving with brutal but not debilitating injures despite being a normal human while Glory was pummelled by it and had the durability surpassing way beyond mortal men. It's possible that the hammer's power could depend on who wielded it at the time (Buffy is the Slayer while Olaf's status as a "god" is rather dubious).