The Collaborative International Dictionary of English v.0.48:

Thane \Thane\ (th[=a]n), n. [OE. thein, [thorn]ein, AS.
   [thorn]egen, [thorn]egn; akin to OHG. degan a follower,
   warrior, boy, MHG. degen a hero, G. degen hero, soldier,
   Icel. [thorn]egn a thane, a freeman; probably akin to Gr.
   te`knon a child, ti`ktein to bear, beget, or perhaps to Goth.
   [thorn]ius servant, AS. [thorn]e['o]w, G. dienen to serve.]
   A dignitary under the Anglo-Saxons and Danes in England. Of
   these there were two orders, the king's thanes, who attended
   the kings in their courts and held lands immediately of them,
   and the ordinary thanes, who were lords of manors and who had
   particular jurisdiction within their limits. After the
   Conquest, this title was disused, and baron took its place.
   [1913 Webster]

   Note: Among the ancient Scots, thane was a title of honor,
         which seems gradually to have declined in its
         significance. --Jamieson.
         [1913 Webster]

WordNet (r) 3.0 (2006):

thane
    n 1: a feudal lord or baron
    2: a man ranking above an ordinary freeman and below a noble in
       Anglo-Saxon England (especially one who gave military service
       in exchange for land)