Gnomes

Of the Fee, the kobolds (more commonly known wichtelmännchen or erdmännchen - 'gnomes' is the term used by scholars) actually interact with humans the most. The former two terms are used to refer to urban gnomes, who access the houses of town residents (perhaps through underground tunnels). They tend to be skillful at artifices, and sometimes reward certain craftspeople they like by leaving little gifts. Conversely, they torment those they dislike. Their motivations are unclear, though it is rumored that they seek alliances with certain artisan guilds, and are willing to share knowledge with them. The Erdmännchen are more likely to have forest or mineshaft haunts. They are wilder and more magical, and, like the famed Rumpelstilzchen are not above stealing (or bargaining for) children.
Unlike dwarfs, kobolds tend to be solitary, or attached to families - human, or, more rarely, their own, though they do on occasion form teams (but despite some kobolds' closeness to humans, they are reticent to give out their names). The urban kobolds roughly correspond to rock gnomes, the mine-dwelling ones are closer to forest gnomes. In fact, however, the 'gnome' presented here is an amalgam of gnomes, halflings, and the Russian domovoi. There may be a special subrace - Klabautermännchen - that dwells on shipboard with sailors. And a 'deep gnome' may in fact be ancestral to both dwarves and gnomes.