Rachael is Deckard's love interest. Part of the problem of her identity is that she doesn't really have one—at least, not one unique to herself. She's a replicant, and her memories have all been implanted, copied from Dr. Eldon Tyrell's niece. At one point, after learning from Deckard that she's a replicant, she muses on her piano-playing skills:
RACHEL: I didn't know if I could play. I remember lessons. I don't know if it's me or Tyrell's niece.
That's the big issue with Rachael: she doesn't know whether she's an individual or whether she has a Franken-personality, cobbled together from someone else's memories. Rachael's not the only one who's confused. When Deckard first encounters her, at Tyrell's penthouse, he's not sure if she's a replicant—though the way the lenses in her eyes reflect light should be a giveaway. Now, after giving her an empathy test, he does discover that she is a replicant—but it takes way longer than it usually does.
If Rachael wasn't an individual before this point, she sure becomes one when she decides to chuck it all and run away. It's an act of defiance and free will as much as it is an act of desperation, and it gets her on the blade runners' hit list, too. Rachael's situation makes us wonder, well, what does make us human? Is a clone or a manufactured "human" just as human as we are? What happens when Rachael says she's in love? How can you fall in love if you're not in some sense human? Even some real humans have a hard time being capable of love, right?
Hollywood Ending… Or Not?
Discovering that he's attracted to Rachael, Deckard ends up inviting her over to his apartment where he sleeps with her, falls in love with her, etc., etc. You know the drill. After tangling with Roy and Pris during the movie's climax, he returns to the apartment, worried that the other blade runner, Gaff, has murdered Rachael. But, for some reason, Gaff has spared her life, allowing her to leave with Deckard.
Depending on the cut of the movie you're watching, Rachael's story ends either happily or ambiguously. In the original theatrical version, the voiceover informs us that Rachael is actually a special replicant with a normal human lifespan: she and Deckard head out to beautiful expanses of natural scenery in the West, free from the suffocating squalor of Los Angeles. In Ridley Scott's revised versions of the movie, the ending shows Rachael and Deckard getting in the elevator to the leave the apartment, with Rachael's truncated lifespan remaining. Her fate seems much more uncertain.