Almost everything that makes the gods mighty comes from a single set of hands: those of the dwarves. Thor’s hammer, Odin’s spear and ring, Freyja’s necklace, the fetter of the wolf – the shining power of Asgard rests on the quiet craft of the dwarves in the dark.
Dwarves (Old Norse dvergar) are small beings, mostly living underground, of unrivalled skill in smithing and magic. They dwell in stone and earth, in the world of Svartalfheim (or Niðavellir, “dark field”). Sunlight is dangerous to them: in some tales a dwarf turns to stone when daylight strikes him – a motif that echoes all the way down to Tolkien’s trolls.
The dwarves came into being in a drastic way. Snorri tells that they first grew as maggots in the flesh of the dead primal giant Ymir; the gods then gave them wit and human shape. Four of them – Norðri, Suðri, Austri and Vestri (“North, South, East, West”) – have ever since held the four corners of the sky, which was formed from Ymir’s skull. So the dwarves are woven into the making of the world from the very beginning.
The dwarves owe their fame to their craft. The sons of Ívaldi made Sif’s golden hair, the ship Skíðblaðnir and Odin’s spear Gungnir. The brothers Sindri and Brokkr forged, in the great wager, the boar Gullinborsti, the ring Draupnir and Thor’s hammer Mjöllnir. Four dwarves (the Brísingar) crafted Freyja’s necklace Brísingamen. And from six impossible things the dwarves wove Gleipnir, the silk-soft ribbon that holds the wolf Fenrir. Without the dwarves Asgard would be poor. All of it in one overview: the treasures of the gods.

The treasures of the gods · Sindri & Brokkr · Ívaldi & his sons · The giants · Ymir.
Poetic Edda: Völuspá (Dvergatal). Snorri Sturluson, Prose Edda (Gylfaginning: origin from Ymir; Skáldskaparmál: the treasures), c. 1220. English public domain: Henry Adams Bellows (1923). Scholarship: Rudolf Simek, Dictionary of Northern Mythology; John Lindow, Norse Mythology (2001).