The first documented reference to the name of Grindelwald was in the year 1146. According to legend the name Grindelwald probably came about as follows:

Language researchers on the other hand have proven that the popular derivation of the name Grindelwald from "Grinde ol Wald" cannot be upheld. They explain the name as follows: The old-German/Celtic word "grindel" meant a piece of wood that served as a barrier. The "grindel" Wald (wood) would therefore be a forested valley that is closed off from the rest of the world. A situation that largely applied to Grindelwald before the opening of the paths along the Schwarze Lütschine River.

The 16 km long Grindelwald valley stretching from west to east and through which the Schwarze Lütschine flows, is limited in the south by the Fiescherhörner and Eiger, in the west by the Kleine Scheidegg, Tschuggen and Männlichen, in the north by the Faulhorn and Schwarzhorn and in the east by the Grosse Scheidegg, Wetterhorn Massive and Schreckhörner.

A Chief in the lands between Lakes Thun and Brienz is said to have sent servants into the two valleys leading south into the mountains to explore what was to be found. On their return one declared having found "many waterfalls" (lauter Brunnen), the other only "rubble or forest" (Grinde ol Wald). This is the legendary origin of the place names of Lauterbrunnen and Grindelwald.

Grindelwald lies in the upper end of the valley in a hollow that is relatively flat on three sides. Nowhere is the name of the first settlers documented, nor is the date of their appearance written in any chronicle. It is most probable that the first settlers in the Grindelwald valley were mountain Celts, who migrated over both the "Scheideggs" during the first century AD.