The Oompa-Loompas were the workers at Willy Wonka's Chocolate Factory, who were imported by Willy Wonka direct from Loompaland. In the early edition of the novel, they are shown as African pygmies. Following criticism, in later editions of the book, they are white skinned and golden hair.  They come from Loompaland, which is a region of Loompa, a small isolated island in the hangdoodles.
When Mr. Wonka went to Loompaland and saw the terrible conditions in which the Oompa Loompas were living, he invited them to come and work at his factory to get away from the terrible country they inhabited and the creatures that preyed on them: namely, the Whangdoodles, the Hornswogglers and the Snozzwangers.
In the book, the Oompa Loompas are the only people Mr. Wonka will allow to work in his factory, because of the risk of industrial espionage committed by his candy-making rivals. They are only knee-high, with astonishing haircuts, and are paid in their favorite food, cocoa beans, which were difficult to find in Loompaland. Although the Oompa Loompas initially spoke only their own language, Oompa-Loompish (which Mr. Wonka was fortunately fluent in), they all now spoke English.