Due to the high-fantasy nature of fairytales and legends, readers may have difficulty in developing a personal interest in any of the characters. Often characters are too outlandish, ideal, or simply not human enough to provide a connection. To alleviate this trap in The King of Elfland's Daughter, Lord Dunsany utilizes names for places and characters that convey their own meanings, whether by reference to a specific name or the evocation of a particular idea.
The name of the "fields we know," Erl, confers two possible meanings, and both give a certain amount of intrinsic development to the small kingdom. The first derived meaning comes from the modern earl, which is the rank of a British nobleman equivalent to a count. Associating this land with such an easily recognizable word to a British audience, Dunsany sets up Erl as the "fields we know" in relation to his readers, and therefore suggests that those fields are conceivably a part of England. This provides a part of the build-up towards the realization that Erl is not the fields we know, a revelation that would have no significance if it were previously established as a magical land.
Another inference about the nature of Erl comes from earl's origin, the Scandinavian word jarl. The chieftains of the North Germanic tribes were given the title of jarl, though later it became a cognate for earl among Scandinavian rulers. The key element of a jarl as it pertains to Elfland is that they ruled only with the support of their people, and could be ousted at their behest. We see evidence of this governmental structure in the beginning of the first chapter of the book, where the king has an audience with a self-appointed parliament of the people of Erl. At their request to be ruled by a magic lord, the king, a title usually reserved for those with nearly unlimited power, is quick to consent. This shows that people both have some influence over the current king, and a strong voice about who will be the future king. Toward the end of the novel, this configuration of power can again be seen when Orion is recognized as the king while Alveric has been on his quest for over a decade. Meanwhile, having abandoned his people, Alveric eventually falls into utter servitude to his own followers, the madmen Niv and Zend. Thus, simply the name Erl gives the reader an immediate impression of the characteristics of the kingdom, from its small size (that of a county), to the arrangement of its government.
The name of Erl's king for the majority of the book, Alveric, can also be interpreted to have two different meanings. The first possible idea is that Alveric is quite similar to the name Alfric, which is a Germanic name meaning "elf ruler." Effectively having two main characters with the same name, this provides both a similarity and a foreshadowing for eventual conflict. The similarity in this case is their love or wanting for Lirazel, which is also the source of the irreparable rift between them. In this case, the naming scheme puts more weight on the clash of interests, as there are few similarities between the two characters in regard to their personalities. Even their obsession over Lirazel manifests itself differently for each character.

Obsession is also suggested in Alveric's similarity to Alberich, the name of a character in Germanic mythology. Alberich was a dwarf who possessed a great treasure, not only a large amount of gold but a magic ring that produced gold itself. When this gold was taken from him, he placed a curse on it, such that any who owned it would be consumed by greed for it. Lirazel, then, is analogous to this great and wonderful treasure, as shown by the immense protection her father provides, and moreso by Alveric's insane quest for her. Since his initial journey into Elfland to retrieve her, Alveric shows either a willingness to destroy the wonders of the magic land, or a complete lack of pathos for their preservation. Thus his obsession, placed above all other things, begins before even meeting her, and comes to a peak at his final search for Elfland. Also, true to the name Alberich, Alveric's influence lays a dooming curse upon the "treasure" as it returns to the Elf King. Lirazel's attachment to Erl ultimately leads to the dissipation of Elfland, also due to the King's love for her, desiring to keep her happy. In the end, it turns out that both the Elf King and Alveric sacrifice their respective kingdoms for the sake of Lirazel, the great but cursed treasure.
Lirazel's name also lends an intrinsic depth, by both its sound and its structure. Lirazel has a lyrical quality to it, flows off the tongue, and is pleasant to the ear, much like the other names that are given to characters from, or possibly from, Elfland. The name marks her as something magical, from outside the fields we know, as the mere sound of it conjures the assumption that it has a place in a poem or song. In addition, the syllabic composition and -el ending is reminiscent of many of the angelic names in Judeo-Christian belief. Drawing parallels to common depictions of angels, Lirazel possesses an otherworldly beauty, and gives the immediate impression of purity and innocence. Both are associated with music, as angels are organized into choirs and sing graces to God, while Lirazel, as a denizen of Elfland, seems inseparable from the idea of song. Also, while they have supernatural power above that of mankind, either in the form of magic or otherwise, they are locked into subservience to man: angels by the will of God, and Lirazel by her devotion to Alveric and their son. Given these similarities, it is easy to imagine Lirazel as an angel-like being, someone who is beautiful, innocent, devoted, and inexorably tied into the notion of music.
Elfland and Erl have characteristics that set them apart, and the names of those who live in each further dichotomize the two lands. Elfland, a place of magic and song, contains rhythmical names such as Lirazel and Lurulu. Lurulu has its own importance, as it shows that even a lowly troll has lovely, flowing name. While Ziroonderel's place of origin is debatable, she is nonetheless highly magical, and so has a name that could conceivably have come from Elfland. In contrast, those from Earl have simple, harsh names that sound Germanic in origin, such as Alveric, Guhic, Oth, and Rannok. This creates the image of a country that is more simple and mundane, and nearly as difficult to live in as the barbarian civilizations from which it draws. The name which does not follow either naming scheme is Orion, as he is the character meant to bridge the gap between magical and mundane, by bringing magic to Erl. Orion is neither particularly harsh nor lyrical, and so falls as a good choice for one who is intentionally supposed to be of both and neither lands. While his name foreshadows his future career path, it is the outsider quality of the name that truly brings development to the character. Through the names the Dunsany has scattered into his world, he is able to present either some background information into the psyche of the character, or induce a mental image based on association with certain names. It is easier to imagine Elfland as a mystical, alluring place when it is home to Lirazel and Lurulu, while we see the open fields dotted with thatched cottages that marks the Vale of Erl, ruled by Alveric. With these correlations already attached to their respective names, the reader may identify more with the setting without having to be immersed in overflowing detail and prolonged development, precluding the dissociation one might feel in regard to many other fairytales and legends.