Martial Art Terminology blog, Charles James Sensei wrote an excellent article on the meaning of Kiai. Below is an excerpt. The full article may be read here.
Let me being my feelings on this term/character/ideograms, kiai is not a battle cry or spirit shout in the sense westerners feel it is a loud expression of spirit and effort where effort is the louder the shout the greater your effort and supposedly spirit level. There is so much more than this when defining and understanding kiai and its energy source called, "Ki."
Ki is a cosmic energy; the animator of life. The Japanese/Chinese proved more than 2,000 years earlier, in such practices as acupuncture and a variety of health and martial arts, that some kind of special energy ran through the body. They call this special cosmic energy ki (kee), which is translated variously as "energy," "spirit," "mind," and "cosmic breath."
A "kiai" can be a slogan, a word, or a nonsensical sound. The nonsensical sound is often used within the practice of karate kata or form. The concept of "ki" and some of its more astounding uses are on their way to being accepted universally.
The two characters/ideograms mean, "scream; yell; fighting spirit," and the first character means, "spirit; mind; air; atmosphere; mood," while the second character means, "fit; suit; join." The spirit yell as to my feelings and perception incorporates a lot more than the yell which is usually manifested as a short curt sound unique to one's system of practice.
But, there is more ....