Some kids these days might think this term comes from the current meaning of hood, as in that place downtown where you might want to watch your wallet. I haven't researched the hood etymology as in neighborhood, but I'm fairly sure it's that simple.

Some folks have thought the word hoodlum comes from the tales of Robin Hood. Others have said it comes from folks who wear hoods over their heads as they commit criminal acts. The 1950's term for bad kids was shortened to hood (think James Dean), but it came from hoodlum. So where did hoodlum come from?

The term seems to have originated in San Francisco around the 1870's and was in use all across America by the next decade. The word's true origin seems to have gone missing, and newspapers back in those days had several articles trying to find reasonable explanations for the origin of the term.

Today, most folks who care about this sort of stuff say that it comes from a Bavarian version of German and the word is Huddellum, which means ragamuffin.

Warning: My daughter says any time she hears someone use this term, she immediately thinks, "Old man word."
According to one theory, generally viewed as a bit of urban folklore, this term originated with a cowardly newspaperman and an uncomprehending typesetter.

Allegedly, there was a gang leader in San Francisco named Muldoon sometime around the turn of the century. Muldoon was so feared that a newspaper reporter who did a story on him attempted to disguise the identity of his subject by spelling the name backward as "Noodlum". The typesetter misread it as "hoodlum" and a new word was coined.

Hood"lum (?), n.

A young rowdy; a rough, lawless fellow.

[Colloq. U.S.]

 

© Webster 1913.

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