The earliest known account of the Dwarfie Stone is in a Latin description of Orkney in 1529 by Jo. Ben, an unknown author, variously identified as John the Benedictine, or John Bellenden. Ben relates that the chambers had been originally made by a giant (i.e., in point of strength) and his wife, and that the latter was enceinte at the time, as was shown by her bed, which had the shape of her body. He was unable to account for the use of the door stone farther than that it was related that another giant, who was at enmity with the occupant of the stone and grieved at his prosperity, made the door stone to fit the size of the entrance so that the occupant might be shut in and perish from hunger, and that thereafter when he himself ruled the island he might have the stone for his own use. With this end in view the other giant took the stone, thus made, to the top of the mountain, and with his arms threw it down into the entrance. The giant inside awakened, and found himself in a quandary, being unable to get out, whereupon he made a hole in the roof with his mallets, and so escaped.

This extraordinary work has probably been the pastime of some frolicsome shepherd, or secluded devotee; and the history of the stone having been lost, it was natural for the people of a superstitious age and country to apply a fabulous origin both to the stone and its inhabitants, in so retired and lonely place as the vale of Rockwich. The story, therefore, goes, that the Dwarfie-Stone fell from the moon, and that it was once the habitation of a fairy and his wife, a water-kelpie.

At the west of this stone stands an exceeding high mountain of a steep ascent, called the Ward-hill of Hoy, near the top of which, in the months of May, June, and July, about midnight, is seen something that shines and sparkles admirably, and which is often seen a great way off. It hath shined more brightly than it does now, and though many have climbed up the hill, and attempted to search for it, yet they could find nothing. The vulgar talk of it as some enchanted carbuncle, but I take it rather to be some water sliding down the face of a smooth rock, which, when the sun, at such a time, shines upon, the reflection causeth that admirable splendour."-- Dr Wallace's Description of the Islands of Orkney, 1700, p52.