O'Hehir describes orcs as "a subhuman race bred by Morgoth and/or Sauron (although not created by them) that is morally irredeemable and deserves only death.
How did Sauron make Orcs?
In The Book of Lost Tales, it is said that Orcs were "bred from the heats and slimes of the earth" through the sorcery of Morgoth. Again, Tolkien later changed this, as Morgoth could not create life on his own. This led to the most popular theory that Orcs were created from corrupted Elves.
Can Sauron create Orcs?
A few thousand years after his master Morgoth was defeated, Sauron had revealed himself to the world and began building his stronghold Barad-dur in the land of Mordor. He gathered what orcs remained, and began breeding a new army with which to dominate the lands of Middle-Earth himself.