A dark horse is something or someone that is perceived to be an unlikely winner and does, in fact, succeed, usually in a competition. It should always be spelled as two words, and does not need to be set apart by quotation marks.
The term was, unsurprisingly, coined in horse racing when the winner was unknown to the gamblers, sometimes by the design of the jockeys and trainers. It first appeared in print in 1831, but by 1844 it was used in the United States for political candidates who won their nominations from seeming obscurity.
Today dark horse is used worldwide in practically every arena of competition from sports to music awards shows, and even referenced in songs.