A person who gives something to another and then takes it back or expects an equivalent gift in return. Although I am not sure, I assume that this term came about as some sort of stereotype of Native Americans.

I think probably the best thought on this subject I saw in a sig of someone over on slashdot:

I finally understood that "Indian giver" referred to our treatment of natives, not their treatment of us.
An indian giver is someone who expects that a gift will be used and appreciated by the person who accepts it. Most indian tribes considered the giving of gifts to be a sacred thing. If a person accepted a gift that they did not like or would never use it was considered disrespectful. It was an insult to the giver and to the gift itself. It was also the duty of the giver to retrieve any present that was not truly appreciated and respected, that was not received in the same spirit that it was offered.
It was considered honorable and righteous to take back a gift, not cheap and greedy as most european cultures seem to think.



Editor's Note: To the best of my knowledge, the above is incorrect. Reciprocity was/is a fundamental mode of exchange for the native american indians. When a gift was given, a gift (of approximately equal value) was expected in return. This is common in hunter/gatherer cultures the world round. When Europeans first observed this, it was misunderstood to mean the native expected his own gift returned.

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