In folklore, gnomes are subterranean spirits who guard the earth's treasures. In psychological terms they symbolize whatever is keeping you from your task of entering and getting to know your unconscious (= earth) so as to discover your inner, true self (= treasure).
According to the Kabbalah gnomes were genii, short in stature, who lived underground and possessed treasures of precious metals and jewels. Their legend travelled from the Near East to Scandinavia and to Central America. They came to symbolize the invisible being who by inspiration, intuition, imagination or in dream makes visible things which are invisible. They exist within the human soul as flashes of knowledge, enlightenment or revelation. They are, as it were, the hidden soul of things, whether organic or not, and when they leave them those things die, become lifeless and shadowy. Gnomes are fickle and can swiftly change from loving to hating a person. Slowly gnomes grew in the imagination into ugly, misshapen, malign and evil dwarfs. On the other hand their womenfolk, although even smaller, were dazzlingly beautiful and wore long pointed slippers, one ruby, the other emerald. The pair, or the gnome duplicated as a male and female complex, symbolizes the conjunction in all beings of the beautiful and the ugly, good and evil, dark and light. Undoubtedly they are images of complex and fleeting states of consciousness in which knowledge co-exists with ignorance, moral wealth with moral poverty. They are examples of the conjunction of opposites and of knowledge held in secret or hidden.
The symbol has no connection with gnomic poetry except a common derivation from the Greek gignoskein, ‘to perceive’.