Men can be classified in three categories when it comes to receiving Allah's message:
Hypocrites (Munafiq) are those who openly declare themselves as muslims but they don't bring forth the fruits of faith. Unbelievers (kafir) are those who openly reject faith and therefore it's not expected that they submit to Allah's commands. A believer (mumin) is one who obeys Allah with the strongest devotion.
There are two examples from the Holy Quran I'm going to use to identify the character a hypocrite. One is from the historical Battle of Trench (Khandaq) and the other one is from the act of worshipping when standing up to pray.
Surah Ahzab (33:9-25), The Confederates, gives us a view about the true purpose behind the Battle of Trench when muslims were commanded by Allah to defended the city of Madina in a war against the enemies. Allah tells us that He actually wanted to expose the hypocrites among the muslims. It was a test of good and evil. The hypocrites were cowards who didn't really want to join the fight and tried to make several excuses to withdraw from it. When they eventually did join the battle they were not active in fighting. In dangers they would look for protection from the Holy Prophet (s.a.w.) but when the danger was gone they would brag about it and make a show of their braveness.
They clearly had a double standard attitude. Allah tells us that when a decision is set by Him and the Messenger (s.a.w.), it is a muslim's duty to follow it (33:36). They can't make any excuses in the act of obedience and if anyone disobeys then they are clearly on the wrong path. People do things on basis of false motives because they don't take higher life seriously but rather treat religion as a jest. The true believers are only those who believe in spiritual responsibility and act wholeheartedly. Hypocrites can go on doing what is wrong, thinking that they're doing good but the deeds of the hypocrites will be nullified because of their outward show and selfishness. Their motives weren't pure and they had some kind of hidden gain in doing it as to getting some worldly advantage or attention from people. Allah knows a persons inner most thoughts and nothing is left hidden from Him (33:54). Even if the hypocrites took part in the fight at the Battle of Trench, they didn't actually gain any profit by it because their intentions were wrong. They may have won temporarily by saving their lives but their ending in the hereafter will be miserable.
Say: "Shall we tell you of those who lose most in respect of their deeds? "Those whose efforts have been wasted in this life, While they thought that they were acquiring good by their works? They are those who deny the signs of their Lord and the fact of their having to meet Him (in the hereafter): vain Will be their works, nor shall We, on the Day Of Judgment, give them any weight. That is their reward, hell; because they rejected faith, and took My signs and My Messenger by way of jest". (Quran 18:103-105)
A person will always do what attracts him the most or what he finds most loveable. The hypocrites from the Battle of the Trench didn't submit their wills to Allah, in other words they didn't love Allah. The idea is that you can't withdraw from a command that has been given and at the same time love Allah. It doesn't go together. You can't only be a muslim by name or birth and not follow it's laws. And you can't have a selective moral where you practice only what you find easy and ignore what you find difficult.
"Say: "Call upon other (gods) whom ye fancy, besides Allah: they have no power,- Not the weight of an atom,- In the heavens or on earth: No (sort of) share have they therein, nor is any of them a helper to Allah. (Quran 34:22)
Who is a false God? A false God / Idolatry (Shirk) may involve statues or images but it can also be anything that we love or are attracted to that is not Allah. The love of money, power, a certain influential person, family, comfort, success, your job or even loving yourself can be a form of idolatry if you give all of these more importance than Allah. Everybody wants to live for something, and if that something isn't Allah then it is a false God.
"Seest thou such a one as taketh for his god his own passion (or impulse)? ...." (Quran 25:43)
The true respect of Allah excludes the worship of anything else. If you place anything in the centre of your life, other than Allah, then you are not submitting yourself to Allah. These are all good things but becomes dangerous if you make them the ultimate fixation of your life. The allures of idolatry is very strong and makes us attach our attention to created things rather than the Creator Himself. Eventually everything that has been created will be destroyed. What happens if we lose an influential person that was the centre of our lives? It will only leave us hurt. The false Gods are never permanent, only Allah is permanent and He is the only one who really loves you. The idols that you worship neither loves you nor can help you. If you worship your idols and build your life on others than Allah then it will eventually destroy your life.
Prayer is another example of testing the good and evil. A test to see who is a true believer among the muslims. A muslim who stands up to pray salat for worldly gains, and not for the sake of worshipping Allah, will not get his prayers accepted. Allah is always testing us to see which one of us is a true believer and who deserves felicity (24:51). Allah tells us that the hypocrites will be in the lowest depths of the fire where they will find no helper (4:145).
The only reasons why their contributions are not accepted are: that they reject Allah and His Messenger. that they come to prayer without earnestness; and that they offer contributions unwillingly. (Quran 9:54)
The Hypocrites - they think they are over-reaching Allah, but He will over- reach them: When they stand up to prayer, they stand without earnestness, to be seen of men, but little do they hold Allah in remembrance; (Quran 4:142)
We can't compete against the wisdom of Allah and we can't accept Allah's decree by using our own logic. It has to be accepted loyally and with best of effort. Our will must be the same as the will of Allah. There is no excuse at all. Allah's laws are universal and can be followed anywhere in the world. The hypocrites thinks that they can compromise with Allah and come up with some excuse for not obeying His commands. In reality, they are not true with themselves and therefore their hearts is a disease. This disease can spread like all other disease. They are curable but if the disease is spread too much it will soon come in the category of those who deliberately reject faith, the kafir. They think that they can get the best of both worlds by compromising with good and evil but even their good deeds are profitless because they aren't sincere to themselves. They don't really love Allah but they rather have their hearts dedicated to something or someone else. A question is raised by Allah Himself to the hypocrites and the idolaters:
Say: "Think ye to yourselves, If there come upon you the punishment of Allah, or the hour (that ye dread), Would ye then call upon other than Allah? - (Reply) if ye are truthful! (Quran 40:40)
The answer is most obviously no. This question is not only for the hypocrites from the Battle of Trench but it applies to all muslims from the past, the present and the future. On judgment day we can't ask anyone else for help. The things that we used to worship, the false gods, can't help us at all. It's only Allah that can save us. To conclude, a Mumin (true believer) is one who hears, obeys and puts his heart into the act of worshipping. A Munafiq (hypocrite) is one who only hears and if he by chance obeys a command then he doesn't put his heart into it and he will fail in the end. Mankind are created only to worship Allah. We all, men and women, have a personal responsibly to follow Allah's message as it should be followed.
"....He that obeys Allah and His Messenger, has already attained great victory". (Quran 33:71)
References: The Glorious Quran - translated by Yusuf Ali