Often exist near volcanoes, or at least near volcanic activity. They are not themselves volcanoes, though, as nothing molten is coming out (or for that matter solid). Can be an early sign of a volcano to come, or the last remains of activity, or just because -- and in any case are studied by vulcanologists for clues about what hot stuff is doing deep underground, heating and forcing the gasses out. The word was adopted from Late Latin (either directly, via French, or via Italian) fūmāriolum, smoke hole, diminutive of Latin fūmārium, smoke chamber, from fūmus, smoke. Because as we all know, steam looks just like smoke.
The Icelandic volcano Eyjafjallajökull, which generated by far the most buzz on the show floor, landed a seven-figure deal for a memoir that will cover its early days as a steam-venting fumarole right through to its headline-making eruption.
—Laurence Hughes, "Things I'd Like to See This Weekend on C-SPAN's Book TV"