fatnaður

Apparently a compound of Old Norse fat (“clothing”) (itself from Proto-Germanic *fatą (“clothes”)) + an element naður of unclear interpretation and origin (as the usual sense of "adder" or "sword" makes little sense in context).

fatnaður m (genitive singular fatnaðar, no plural)

1. clothing

   Synonym: föt

• aðhaldsfatnaður

• Ásgeir Blöndal Magnússon (1989) “fatnaður”, in Íslensk orðsifjabók, Reykjavík: Árni Magnússon Institute for Icelandic Studies, →ISBN (Available at Málið.is under the “Eldri orðabækur” tab.)
• “fatnaður” in the Dictionary of Modern Icelandic (in Icelandic) and ISLEX (in the Nordic languages)