According to the Silmarillion, Finrod commissioned the Dwarves of the Blue Mountains to aid him in the making of his underground stronghold of Nargothrond. These Dwarves gave him a name in their own tongue, felakgundu or 'Hewer of Caves', from which Finrod's surname Felagund derived. This was meant at least partly in a literal sense, because Finrod was said to have performed some of the finer carvings himself.
Earlier sources give a quite different account, suggesting that the name actually had an Elvish origin, meaning 'Lord of Caves' (and indeed this tradition is preserved in one Silmarillion passage) though this etymology seems to have been abandoned in favour of the Dwarvish explanation. Nonetheless it is suggested that Finrod's fellow Elves would at times use a variant form, Felagon, which is interpretable in Elvish as 'just or fair lord'. Though we're told that this Elvish variant existed, it should be said that there are no recorded instances of its use.
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