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• +2 Dexterity, –2 Strength.
• Small: As a Small creature, a halfling gains a +1 size bonus to Armor Class, a +1 size bonus on attack rolls, and a +4 size bonus on Hide checks, but she uses smaller weapons than humans use, and her lifting and carrying limits are three-quarters of those of a Medium character.
• Halfling base land speed is 20 feet.
• +2 racial bonus on Climb, Jump, and Move Silently checks.
• +1 racial bonus on all saving throws.
• +2 morale bonus on saving throws against fear: This bonus stacks with the halfling’s +1 bonus on saving throws in general.
• +1 racial bonus on attack rolls with thrown weapons and slings.
• +2 racial bonus on Listen checks.
• Automatic Languages: Common; Bonus Languages: Any
Known to humans as halflings, elves and goblins as the little people, and dwarves as shortfolk. But the correct name, at least to them, is the Traveling People. Even if people only call them that to their face. They are responsible for the rise of civilization as it is now known.

History and Legends
No one is entirely certain when halflings arrived, for arrive they did. Halfling legend claims that their homeland was destroyed by some cataclysm (the legends are vague about what exactly it was) and they fled to this world. When they came to this world they began the search for a new home, but found instead the freedom and safety in travel. And so even now the majority remains in constant transit, by tradition never remaining in one place more than seven days.
Most estimates put the arrival towards the end of the Giantwar. One human legend claims that when the last giant was slain the first halfling caravan wheeled out of its carcass, although this is generally dismissed since the Sagas do contain a few mentions of the traveling people. Their own legends describe the world the halflings came to, which the Loremasters further use to date their arrival, describing as they do the nomadic human tribes and their massive racial enemies.
Whenever they arrived, halflings have been around so long that no one can really imagine the world without them. They are almost like the wind to most governments now, occassionally annoying but completely beyond control. Because they never stay long, pay for their travels, and carefully obey local authorities no one strenuously objects to their presence.
For the purpose of records halfling merchants adopted the elven alphabet for their own use, along with knowledge of paper and ink production. They then taught these tools to humans, who were just beginning to build their early kingdoms. Humans also learned the halfling language, which by this time had become a pidgin of their own tongue and all the languages they had learned from their travels. When contact between peoples grew they found the language they had most in common was that of the traveling people, and so communicated with that. Halflings were thus responsible for the now dominant alphabet and for the Trade language.

Government and Culture
Caravans are small enough that everyone knows everyone else without being so small they can create what humans refer to as "cabin fever." There are as many as a few hundred halflings in a single caravan, so that while they are small there is still a decent population to draw skills from. With these numbers formal government has little use, as everyone knows everyone else. If a major divisive issue should appear and cannot be resolved, often the two groups simply part ways when they next find a fork in the road.
The leader of a caravan is its Loremaster. A loremaster's duties are very much the same as those of an elven witch, they must preserve the history and stories of their people, act as spiritual head, and secular leader. A loremaster does not rule, but is responsible for guiding the people under his leadership as best he can. Halflings with disputes they cannot solve look to their loremaster for advice, when trouble appears it is his duty to find the solution (or at least find those who can and help them to do so), and in general serves as their last resort for all matters. He acts as spokesman for his caravan when dealing with outsiders, and his decisions are almost always accepted by the caravan.

Religion
Halflings have no formal religion. They have adopted some of the gods of their new home, but also keep some of those from the last. Chiefly among their old gods is Yondalla, a goddess of fertility, plenty, and also patron of freedom. She also sees some reverence in certain rural areas within the Empire in which the caravans of the Traveling People are a common sight. One of the most important gods they have adopted is Jev, god of the land and patron of those who walk upon it.

Loremasters
Religious instruction is a duty of the Loremaster, along with history, reading, and most education. It is one of the most important lessons a Loremaster teaches, the one he must live his life by, that no storyteller is objective. The duty of a Loremaster in collecting tales isn't to memorize them as they are, but to hear all sides of the story and based upon them try to reconstruct what really happened. The Loremasters know all the myths, in some form or another, but when they tell a story it is the form they have deduced from all those different points of view. Because they came to this world from outside the halflings can objectively look at events, which they say is another reason they stay mobile. To give up the road would tie them down not just to a location, but to a particular way of thinking.

Relations With Other Races
The Traveling People do not by any means keep to themselves. They eagerly interact with the locals of any area they are passing through. When they decide to stop for a few days they choose empty land, or pay for the place they are using. During this time the caravan is open to all who choose to come. Halflings bring news to isolated areas, trade goods accumulated from distant places, and provide spectacles. Shortfolk shows are famous for their incredible quality. Everything from stories and songs collected from across the world to gymnastic displays of fire and steel. They offer plays and dances, along with exotic foods and goods. And somehow, though they stock up on goods and pay for where they stay, halflings never leave a stop with less than they arrived with.
Goblins are most lenient, as far as tolerating the caravans goes. Since they are no threat to the lords and certainly pay their way, no one sees any need to stop them. The only contention is that the little people insist that among their wagons they make the rules, and will never bar elvish serfs (they are also the chief method of escape for lone runaways, though the lords consider their merchants' goods worth the occasional lost elf).
The Empire is similarly content to let the halflings roam, though some road patrols like to harass the caravans in the hope of bribes. Dwarves build their holds underground, where the shortfolk and their pack animals prefer not to go. So the caravans tend to park some distance from the main entrance of the stronghold in the hills among its supporting holds.
The Kobold church only rarely permitted outsiders in its lands, and then only briefly. The caravans of the Traveling People were expressly forbidden, as heathens could not be tolerated among the faithful. For a brief time the Republic tried to open the borders, but with the chaos ruling their lands and pressures on from the dwarves and humans this was hardly plausible. Drak's reign has again closed the borders to all non-dragonkin, making this one of the few places the Traveling people do not go.
It is important to note that halflings are not the only ones that live in the caravans. They welcome anyone who wishes to join and gladly pick up travelers they encounter. All they ask is that whoever travels with them does his share to help the caravan as long as he is in it. Most commonly found are elves escaped from serfdom by stowing away in the caravans. Orc lords do require searches of exiting caravans to prevent this, but their guards tend to be lazy and apathetic. Not to mention easily bribed.

Naming Convention
At birth a halfling is given a name by his parents. As he grows he may accumulate any number of additional names for distinguishing characteristics or acts. When he is taken as an apprentice by an elder member of the caravan the halfling picks one of his names to be his first name, which he assigns to his work. In addition on completing apprenticeship his master passes down a second name, generally the one given him by his master (though sometimes exemplary students warrant an embellishment on this). Failed or rejected apprentices do not receive a second name. The third name is that of the caravan, which was decided by consensus when the caravan was first formed.
Outsiders who join the caravan accumulate names the same as any other member. They are encouraged to take the name of the caravan, but can also gain a second name. Most prefer to keep their given first name, but do take the additional names to try to fit in.