Please read the Halfling node first (if you don't know what a halfling is).
Yondalla was the smallest of all the gods in the heavens. Although she was bold and she was brave, the other gods saw her as an unimportant Goddess (because she had no followers). One time when all the gods were gathered together, she asked them "Which of you is the greatest?". Of course none of them could agree. The argued and fought, and in the end they all decided to blame the whole thing on poor little Yondalla.
Yondalla saw the power that worshippers gave to the other gods. She decided to get some of her own. So Yondalla left the Seven Heavens, and went to world below.
She searched high and low looking for the perfect follower. Most folks already had gods of their own (Yondalla knew she could steal them away, but she was never the kind to cause trouble). While other folks had no god, but were evil and liked to cause pain. Yondalla decided that such followers would be to much trouble to take care of. So she continued to search.
One day Yondalla came down to a riverbank and saw Littleman fishing. She knew then that her search was over. She saw in him a follower much like herself, brave, clever, kind-hearted, and full of mischief (and they were the same size). Yondalla went to Littleman and she offered him an agreement. If Littleman could gather his people together into villages and towns and worship her. Then she would provide them with a life of peace and plenty. Littleman thought this over and answered with a single word, "Done".
Yondalla went back up into the heavens to watch over the halflings. While Littleman taught them how to outsmart their enemies. Soon he had gathered together a small village right there on the same riverbank he met Yondalla on. She then sent him to wander and gather together the little people wherever he may find them (but that is another story).
Loosely based on material from The Complete Book of Gnomes and Halflings
The halflings for the most part believe that their race has always existed. But it wasn't until Littleman and Yondalla, that they became civilized (although some of the oldest elves can tell a different story). There are a few regional variations to this story. The first one is that whatever village you are in, that is the one Littleman built first (at least all villages that are more than 4 or 5 generations old). The halflings alway believe that Littleman built "their" village (and that he lived in it for a time and eventually died there).
Littleman represents every positive to quality to the halflings. There are hundreds of stories about him (even more than there are about Yondalla herself). The Littleman stories serve as an oral Bible for the halfling race. Everything from lust, to greed to, name calling is covered by a Litteman story (and they are all so entertaining and heroic that the little children never know they are also learning good morals).