How does Shakespeare characterize the witches in Macbeth? What is their thematic significance?
They are characterised as hags upon the blasted heath.
Shakespeare characterises the witches within the context of his time. By the time he wrote Macbeth James VI of Scotland had ascended the English throne. Macbeth had to interpret or indeed distort Scottish history in the play.
With regard to the witches this was a time when there were widespread witch hunts throughout Europe. James had a particular fascination for the subject and published an extract Daemononlogie. So Shakespeare's characterisation of witches reflected James's views on the subject, that of ugly, dangerous hags who were to be legitimately hunted and persecuted because of their links with the devil.
Their thematic significance is central to the play. They predict to Macbeth and Banquo what will happen. Macbeth is startled because their predictions already reflect what is going through his head, namely a desire to seize the throne.
However Macbeth still has the opportunity not to follow their predictions. However he does so egged on by his wife.
The witches also predict that Macbeth will not have children who will become king but Banquo will. This should have sent out a signal to Macbeth but it doesn't.
They reflect the central theme in the play and again it reflects the culture of the time. Society was seen as highly stratified within the context of feudalism and the Divine Right of Kings. James was king because he had a divine right to be so. Everything had its place based on God's will and if that is disturbed then there will be consequences until the legitimate order is restored.
As soon as Macbeth kills Duncan then his fate is sealed within this context. Order must be restored and it is with Macbeth's death. Duncan was James's ancestor so Shakespeare had to take account of this in his writings.
The witches represent disorder and what will happen if you take this path.