This is pretty much the whole point of the Superfriends story The End, where the Legion of Doom become far, far more tormented, horrific and powerful beings than their previous laughably incompetent selves.
Nyx is an intriguing variant... she is forced to become Nightmare Moon in a physical sense, but doesn't really act evil at all, even though everypony expects her to.
In the grand scheme of things, this is also what happened with Discord. Twice, actually! He was always a reality warping spirit, but of his entire race he was the weakest, and was slightly nicer than later in life. Then, in the Alicorn/Draconnequi war he both discovered his love of sadism and increased his power by eating his brother. Then he was reborn on Equestria, with no memory of his past existence, and became an odd but ultimately kindhearted being. Then his original personality resurfaced, and he became the Big Bad from canon.
Film Critique (aka the Pegasus Despot) from "Gaiden: 7 Dreams/Nightmares". Before the collapse of G2 society, he was just some fat nerd. Afterwards, he got his hooves on the Blue Shard of the Rainbow of Light (Laughter), which not only gave him the ability to control ponies, but also to restore power to his city, which allowed him to become its Evil Overlord. Then Patch shows up and steals the Shard back from him, leaving him to his Karmic Death at the hooves of his previously-brainwashed harem, begging like the pathetic little nobody he was.
Chrysalis started out as a little Zebra in a small village in the middle of nowhere, then became vampiric monster, draining everypony she could get dry of their love but still remaining little more than a local menace until she became a slave to Queen Cocoon, considered so low on the pecking order she was only good for entertainment. By the end of her Origins Episode, she's killed off the Changeling Queen and taken over the hive, becoming the Big Bad level threat she's known as.
Equestrylvania has the Creepy Mortician Dirt Nap. An outcast among ponies because of his special talent for burying the dead, he grows to hate the rest of Ponyville in turn. When he stumbles across Dracula's minions searching for one of his body parts, they sense the emptiness in Dirt Nap and offer him a purpose and a chance for revenge against those that scorned him. He accepts and becomes the host for the demon Aguni, before proceeding to burn down most of Ponyville.
In The Wizard in the Shadows Harry is technically already a nightmare - to the bad guys. He proceeds to become an even bigger nightmare. First, he's an eleven year old muggle raised kid. Then he becomes The Chosen One and a general badass. After his unwilling long term stay in Middle-Earth, he's a Knife Nut, a Master Swordsman and the terror of every bad guy short of Sauron himself - who is noted as being wary, though not in a personal sense, of what Harry is capable of - and has people speaking his name in tones of awe/fear from the tip of Northern Middle Earth to Far Harad.
In the fic itself, he proceeds to ramp it up even further, wielding Physical God level powers (though he was being powered up for those incidents) and is revealed to be a low level Reality Warper he disregards the basic laws of magic. And yes, only his finite power levels and lack of comprehension of exactly how powerful this makes him stops him being a total Game-Breaker.
The same could be said for Lyrius, who was simply a teenage boy and a resident of a city in the path of her demonic army, who would have been slaughtered just like everyone else had he not had the courage to stand up to her, thinking he had nothing to lose. She was in no danger, but the display impressed her enough to offer him a place by her side which he accepted. He later became one of the most dreaded warriors of the Emperor of Shadow, and feared by the Queen's subjects almost as much as they feared her.
The Rise of Darth Vulcan has the titular character: Ted was originally just a common teenage Jerkass, until he found the Alicorn Amulet and was transported to Equestria. Now, he's an Evil Sorcerer who can fight the Mane Six and the Princesses evenly, leads a vast army of Diamond Dogs, changelings, Equestrian criminals and outcasts of every stripe, and minotaur mercenaries, and has declared himself the absolute ruler of the Everfree Forest.
Artful Dodger, Vulcan's apprentice and one of his Co-Dragons, also counts. Before he met Vulcan, he was just another street urchin criminal. Now, after some magically induced level-ups in badass, he's one of the most dangerous beings in Vulcan's army, with a fearful reputation amongst them, and even has his own minions now.
Pagan Vengeance: Juvage was the son of a minor chieftain in Lithuania. By the end of the story he's leading a bloodthirsty Army of Thieves and Whores, killed Genghis Khan in personal combat, defeated the Mongols, the Russians and the Teutonic Knights.
Because of his utter lack of backstory, there are numerous stories that make KingSombra this. One such example is The Umbra King. In it, Sombra was little more then an ordinary unicorn who lived on the outskirts of The Crystal Empire. But when arctic timberwolves killed his family (they nearly killed him, too) he, desperate to live again, found The Nightmare Gem and merged with it, leading him to become the tyrant he is now.
Friendship Is Magical Girls: Snails starts as one of Those Two Bad Guys to Sunset Shimmer in the Magic Arc, until she sacrifices him to Chrysalis to appease her. This leads to Snails being transformed into the Royal Drone Eskarrg, who acts as Chrysalis' Dragon in the Loyalty Arc.
Fallout: Equestria: Starlight has the Sins, seven ponies (well four ponies, one zebra, one donkey ghoul, and one minotaur) who were transformed and given great power through dark magic. All of them qualify, but none more so then Sloth... ...Better known as Cranky Doodle Donkey.
Implied in "In Her Memory". Zentashin rose from slavery to become a powerful Sith Lord, only to watch his lover die. It's implied that he wades through a lot of corpses to see her death avenged.
We Are What We Are has Starshot. Downplayed in that he was Starswirl's nephew, but he starts out as just another one of the Dazzlings victims. He's now the Big Bad, and come chapter 46, and he's coming damn close to getting his revenge.
Shinra High SOLDIER has Julia Nakahamou, who starts her life as the daughter of a very poor family and spends years of her teenagehood being completely terrified of her parents and allowing them to abuse her in spite of her tremendous powers. Once she is drafted into the Shinra army however, she almost immediately becomes its amoral and arrogant Commander, with genocide and arbitrary executions (through torture) as her favorite solutions to problems.
The Difference One Man Can Make shows us Harry Potter landing in Westeros - North of the Wall - equipped with his wand, the clothes on his back and a travel bag. Less than five years later, he managed to gain authority over tens of thousands of Free Folk, founded two cities, threw the bases for an entire civilization and is known as the Witch-King-Beyond-the-Wall in the Seven Kingdoms and Essos.
In Ambience: A Fleet Symphony, Franklin Roosevelt Kevinson, the former admiral of the first-generation Shiratsuyu-class, was originally just some two-bit lieutenant who got chosen to play the role he got. In chapter 293, Sanford says that both he and Big made the mistake of thinking that Franklin would be just an indignant but ultimately powerless nobody once his part came to an end. Little did they expect that he would make his return as a superhuman cyborg, admiral to the first American shipgirls and a major player in the coup against President Blackwood.
In The Sage's Disciple, Crow is this to the rest of the 4th Holy Grail War participants as he literally appeared out of nowhere, leaving them with nothing to work with aside from what he lets them see. He and his Servant Caster have really lived up to the nightmare part by disarming Gilgamesh of all of his weapons, a feat that left the King of Heroes catatonic for several hours.
The Makings of Team CRME: Cinder Fall is one of the major antagonists of RWBY and caused a massive amount of destruction with her actions. My Name Is Cinder shows that she was the little girl Cinder Autumn Stark and was continually abused by her mother. While the Stark family was rich, they were not known much outside of the elites. However, the story shows her getting on her way to becoming the diabolical Cinder Fall.
Apotheosis (MHA): Midoriya Izuku went from a bullied quirkless kid to the worst supervillain Japan has seen since All for One in little over a year, all thanks to the Infinity Gauntlet.
Similarly, in Mastermind: Strategist for Hire, Izuku goes from a bullied Quirkless kid to a widely-feared criminal mastermind and one of the greatest threats to Pro Heroes in all of Japan.
The Temeraire fanfic Black Wings, Black Sails follows Will Laurence as he goes from a tolerated third son of a minor noble and ordinary ship captain in His Majesty's Navy, to a feared pirate with an ever-growing bounty on his head.
The Land of What Might-Have-Been eventually reveals that the Hellion - a monster feared throughout the land and powerful enough to go toe-to-toe with Elphaba - started out as the alternate Dorothy Gale, an unassuming fifteen-year-old farm kid left in the path of a Fantastic Nuke and horribly mutated by exposure to portal radiation.
This Bites! Jeremiah Cross becomes this to the World Government after he joins the Straw Hat Pirates. He is from the regular world and was a fan of the manga, meaning he knows everything up to the end of the Dressrosa arc. After getting his hands on a transceiver, a Vegapunk device that allows to connect to every single transponder Snail in the world, he begins airing the World Government's dirty laundry for all the world to see.
Janine in the Sanctuary fanfic Concerning Us starts out as a simple university student the Praxian Council doesn't even deem worthy of investigation. After spending a century fighting the product of their reckless experiment and taking several levels in badass she's in the secluded city, and she's coming for them.
Ranna qualifies as well: from just one of the aspiring young politicians to Seneschal who easily manipulates people, with a hidden agenda to take down the Council. Then she does so, in spectacular fashion.
A Villian is the Hero of Their Own Story: All For One used to be a boy named Hisashi who was kicked out of his home along with his brother Kazuki after developing a Quirk. When courting Inko, he mentions that some of his last truly happy memories are of he and Kazuki digging through Dagobah beach for scraps to survive off of. This is the same man who'd not only go on to become the top villain in Japan, but also admits he's probably killed a relative or ancestor of the vast majority of people in Japan.
In The Devil of Zero, Abaddon finds it hard to believe that Mundus would become one of the most powerful devils ever known, considering he wasn't very impressive six thousand years ago and was kind of a wimp based on the older demon's words.
In a Wander over Yonder fanfic, You Just Had to Destroy that Planet, Jōshō (a Reality Warper and main character) was just a married man living in said world making weapons for villains with his wife, Jihi. Said villains (except Lord Dominator) decide to raze his planet in search of a rumored ultimate weapon killing Jihi in the process. Jōshō snapped and decided to actually bust out said weapon. With it, he slays the villains, breaks Wander with talking, and now traveling the multiverse as a villain who wants to see the world suffer. To add insult to injury, he gains Dominator as a girlfriend. And he's training her in his fighting style.
Toph is this to the Fire Nation in Flames of Regicide. From a nobleman's blind daughter to a powerful earthbender to quite possibly a worse threat than the Avatar, all because of her invention of metalbending. All of the Fire Nation's machinery, weapons, and armor are made out of metal, so if Toph can teach her metalbending to others, a relatively small force of earthbenders could devastate the Fire Nation's armies with ease.