Origin and history of gnarly

c. 1600, probably a variant of knurled, from Middle English knar "knob, knot in wood, protruding mass on a tree" (late 14c.), earlier "a crag, rugged rock or stone" (early 13c.), from a general group of Germanic words that includes English knob, knock, knuckle, knoll, knurl. Gnarl (v.) "make knotty," gnarl (n.) "a knotty growth on wood," and gnarly (adj.) all seem to owe their existence in modern English to Shakespeare's use of gnarled in 1603:

[T]hy sharpe and sulpherous bolt Splits the vn-wedgable and gnarled Oke. ["Measure for Measure," II.ii.116]

"(Gnarled) occurs in one passage of Shakes. (for which the sole authority is the folio of 1623), whence it came into general use in the nineteenth century" [OED].

very common adjective suffix, "full of, covered with, or characterized by" the thing expressed by the noun, Middle English -i, from Old English -ig, from Proto-Germanic *-iga-, from PIE -(i)ko-, adjectival suffix, cognate with elements in Greek -ikos, Latin -icus (see -ic). Germanic cognates include Dutch, Danish, German -ig, Gothic -egs.

It was used from 13c. with verbs (drowsy, clingy), and by 15c. with other adjectives (crispy). Chiefly with monosyllables; with more than two the effect tends to become comedic.

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Variant forms in -y for short, common adjectives (vasty, hugy) helped poets after the loss of grammatically empty but metrically useful -e in late Middle English. Verse-writers adapted to -y forms, often artfully, as in Sackville's "The wide waste places, and the hugy plain." (and the huge plain would have been a metrical balk).

After Coleridge's criticism of it as archaic artifice, poets gave up stilly (Moore probably was last to make it work, with "Oft in the Stilly Night"), paly (which Keats and Coleridge himself had used) and the rest.

Jespersen ("Modern English Grammar," 1954) also lists bleaky (Dryden), bluey, greeny, and other color words, lanky, plumpy, stouty, and the slang rummy. Vasty survives, he writes, only in imitation of Shakespeare; cooly and moisty (Chaucer, hence Spenser) he regards as fully obsolete. But in a few cases he notes (haughty, dusky) they seem to have supplanted shorter forms.