This article or section needs to be cleaned up to conform to a higher standard of article quality.
This article or section needs more/new/more-detailed sources to conform to a higher standard and to provide proof for claims made.
The Nauglamír or Necklace of the Dwarves is a piece of jewelry which appears at the end of the Narn i Chîn Húrin.
The Nauglamír was forged by the Dwarves of Nogrod out of the treasure of Nargothrond, after Húrin Thalion had brought this to the Kingdom of Doriath. These Dwarves had been invited to Menegroth by King Thingol to create jewelry out of the immense treasure, and the Nauglamír was their best work.
Thingol prized it above everything else in his treasury, save the Silmaril of Lúthien and Beren. After the Nauglamír had been forged he asked the Dwarves of Nogrod to set the Silmaril in it, which they did. Together it became jewelry more beautiful than anything ever before seen in Arda.
The Dwarves were enthralled by it as well, and greedily demanded it from Thingol, claiming it as just payment for their labours. Thingol realized they just wished to claim the Silmaril, and sent them from Doriath without any payment, an event which led directly to the Sack of Doriath in which Thingol was slain.
After Thingol's death the Dwarves of Nogrod tried to return home with the entire treasure, but they were waylaid by Beren, leading an army of Laiquendi and Ents. The Dwarves were all slain, and the treasure was cast into the River Ascar, except for the Nauglamír, which Beren took with him to Lúthien.
After Beren and Lúthien's final deaths the Necklace went to their son Dior in Doriath, and as such was the direct cause of the Second Kinslaying when the Sons of Fëanor attacked Doriath in an attempt to claim the Silmaril. Dior's daughter Elwing fled to the Havens of Sirion with the Nauglamír.
During the Third Kinslaying the Sons of Fëanor attacked the Mouths of Sirion, trying to claim the Nauglamír with Silmaril again, but Elwing cast herself into the sea with it. The Nauglamír was lost, but Elwing and the Silmaril were saved by the Vala Ulmo.
Other Versions of the Legendarium
In earlier versions of The Silmarillion tradition, the Nauglamír, then called Nauglafring, is more important: it more directly causes the death of Thingol as it gets caught behind a tree branch when Thingol is riding outside the Girdle of Melian and is attacked by the Dwarves. Thingol, unhorsed, is slain, after which Melian's protection is lifted and Doriath is sacked.