Also called the Necklace of the Dwarves, Nauglamír was forged by the Dwarves of Belegost and originally made for Finrod Felagund (according to the published Silmarillion). It contained the Silmaril recovered by Beren and Lúthien.
Húrin brought the Nauglamír to Doriath from the ruins of Nargothrond as payment to Thingol for the care Húrin's family had received while he was imprisoned by Morgoth. After the inclusion of the Silmaril, the Dwarves greedily demanded Nauglamír (their best work) as payment for their labours. Thingol saw that they desired the Silmaril, his most prized possession, and after insulting the Dwarves and insisting that they leave Doriath, they slew him in response.
When word reached Beren, he and an army of the Laiquendi slew the remaining Dwarves; Beren took Nauglamír with him to Lúthien. Following their deaths, Nauglamír passed to their son, Dior, thus leading to the Second Kinslaying, in which the Sons of Fëanor attacked Doriath in an attempt to gain the Silmaril. During the Third Kinslaying, the Sons of Fëanor attacked the Mouths of Sirion, again claiming the Nauglamír; however, Dior's daughter, Elwing, cast herself into the sea with it. Elwing and the Silmaril were saved by Ulmo; however, the fate of Nauglamír remains unknown, as Tolkien himself never finished the story.