The Toclafane are eventually defeated once the Paradox machine keeping them in the 21st Century is destroyed and this causes time to reverse and everything goes back to normal.
As weapons the Toclafane have energy devices capable of easily hitting targets and disintegrating them. They also have retractable blades able of cutting its prey into pieces.
As part of this process they regress into little more than children like when one is asked why they would kill their own kind, it responds, "Because it's fun". They also have shared memories. The name Toclafane is given to them by the Master, who takes it from the Gallifreyan equivalent of the bogeyman.
The Toclafane are the last remains of humanity from the year 100 trillion. These humans originally set off, helped by the Doctor, to Utopia which apparently is the last resting place of the human race. Utopia was supposed to have sky's made of diamonds but in fact all it was just the "the dark and the cold" of space thought up by The Master.With no other option left the humans cannibalised themselves and turned into a new cyborg race. They were helped in doing this by The Master with his fantastic mind which helped him to cannibalise the humans and bring them back to 21st Century Earth using his new Paradox Machine and "magical time machine"