It would be unfair to blame writer Stephen King for our collective fear of clowns, but when it comes to who's responsible for making Pennywise one of the most terrifying names in the world, that's all King. It's an innocent enough sounding name, which might explain why the clown is called Pennywise in It. What's more scary than a clown that eats children? A clown that eats children with the mundane name of Pennywise, that's what.
In It, Pennywise the Dancing Clown is just one of the villain's many forms. Pennywise is the clown form of "It," an eternal, shapeshifting being that feeds off fear, specifically fear of children. It's unclear how, exactly, Pennywise got his name. Was it given to him by the kids it haunts, or did "It" choose it? King never really explains it in his book, and he himself does not appear to have had a specific reason for choosing the name Pennywise to be the scariest creature imaginable. Speaking about the origin of Pennywise, King revealed that he set out to create the scariest monster in the world. "So I thought to myself, 'what scares children more than anything else in the world?' And the answer was 'clowns'," King said, via Movie Pilot.
The name Pennywise isn't exactly a popular clown name, at least it hasn't been since King's book was released in 1986. And it's important to note that the story itself takes place in 1958. Still, Pennywise doesn't seem to hold any kind of cultural significance outside of the world of It beyond being part of an old English saying, "Penny Wise, Pound Foolish." This saying is essentially a warning not to be "Penny Wise" — overly cheap when it comes to less expensive or important things — and "Pound Foolish" — wasteful on big things. Perhaps the name Pennywise is a play on the saying, warning children not to be foolish with their lives. Or maybe King just heard the saying and liked the way "Pennywise" sounded.
Not knowing why "It" goes by Pennywise the Dancing Clown certainly adds to his mystique and creep factor. And maybe it's best for everyone involved if this is one question we never get the answer to.