The Dark Elves

In the ages before the coming of man, the elves lived in peace and harmony with nature. The gods of the elves interfered little with their creation save Arawn, who meddled with the world and marred the beautiful works of his kin. Chief among his schemes was the corruption of the dark elves.
An elf named Gwyn lived alongside his brother in the woods of the eastern reaches. His brother, named Gwythyr, was betrothed to a beautiful maiden named Creiddylad. One day, he stumbled upon a black deer in the woods. Gwyn, overcome with curiosity, chased the deer into a cave. There, the deer revealed itself to be Arawn (god of the underworld). Arawn spoke to Gwyn and revealed that he would die alone, while his brother would sire generations of elves with his bride Creiddylad. Gwyn felt something he had never felt before: jealousy. He returned to his home and abducted Creiddylad so that he could make her his wife. His brother Gwythyr retaliated by gathering a great host of elves and attacking Gwyn's fortress on the island of Dwyrain (now part of the badlands). Gwyn, greatly outnumbered, challenged Gwythyr to a duel. Gwyn proved the greater warrior and defeated Gwythyr. The newfound malice in Gwyn's heart had grown in the isolation of his fortress home, and he struck down his brother. Enraged by the death of their lord, Gwythyr's warriors slew Gwyn and brought down his great fortress stone by stone. When they returned to their homes, the maiden Creiddylad revealed the treachery of Gwyn and the murder of Gwythyr, as well as the vengeance wrought upon Gwyn by Gwythyr's warriors. A council of greenseers ruled that the warriors of Gwythyr had been corrupted by the power of Arawn, and banished them to the great below.
As the warriors descended into the depths, they began hearing whispers in the darkness. They shunned the light of the surface and the gods of their people (including Arawn, who had tricked them into kinslaying). The whispers drew them to a massive underground lake, where they discovered an eldritch being called Illuun. They pledged their service to Illuun, who taught them to sharpen their minds into formidable weapons. As their skin turned pale and translucent, their minds developed powerful psionic abilities. Illuun cultivated the malice sown by Arawn and twisted the elves into cruel, hateful creatures. These "dark elves" began to raid the surface and capture slaves for their master Illuun. When the first necromancers were twisted into the orcs, the dark elves found allies in the depths. They spread throughout the great below, often clashing with the Dwarves and other denizens of the deep. As the elves were pushed back to the fringes of the world, knowledge of the dark elves faded. In Sydonian society, dark elves are little more than myth and legend. But as adventurers begin to explore the great below in greater numbers, tales of the dark elves become increasingly more common.
The dark elves of the city of Anun in the great below lived in a matriarchal society, with several noble houses constantly scheming and plotting against each other for supremacy. Priestesses of the "one mind" were the highest ranking members of dark elf society, second only to the Matriarch of the ruling house. The dark elves were eternally at war with the mind flayers (hated enemies of Illuun and the aboleths) and their duergar followers.