Danzou is Naruto's grandfather. His mother's father.

Danzou was made Hokage so that when Naruto becomes Hokage he will be a 3rd generation Hokage.

Another of Danzou's daughters is Sasuke's mother. Therefore Sasuke and Naruto are cousins. They will learn this when Naruto saves Sasuke from the dark side and then the two of them will become co-Hokages like the 1st and 2nd.