From the English word meaning joyful and lighthearted; also a medieval form of Mercy.
Merry derives from the Old English myrige or myrge, meaning pleasant, joyful, or agreeable — the same root that gives us the modern adjective merry. As a given name it has functioned both independently and as a diminutive of Meredith, a name of Welsh origin (Maredudd, meaning "great lord" or possibly "sea lord") with its own entirely separate etymology. This layered origin makes Merry one of those names that can claim multiple ancestries depending on which thread you pull.
R. Tolkien's The Lord of the Rings. Tolkien's Merry is clever, practical, and loyal, the planner among the hobbits, whose full Shire name Meriadoc gestures at Celtic and Arthurian tradition (the name is related to the Breton Saint Meriadec).
Tolkien's use gave the name a specific, affectionate cultural shorthand that generations of readers carry. Prior to Tolkien, Merry appeared as a cheerful supporting character in Victorian and Edwardian fiction — always the warm, uncomplicated companion who made difficult situations bearable. As a standalone name, Merry occupies the charming territory of names that are descriptive without being grandiose — like Joy, Grace, or Bonnie, it states a quality rather than invoking mythology or history.
It went through a quiet period in the late twentieth century when "cheerful" names felt insufficiently serious, but vintage naming revivals have brought it back. Contemporary parents are rediscovering Merry as a name that is warm, literary, and completely unambiguous about the disposition it wishes upon its bearer.