In the days when neither the Æsir nor the Vanir were friendly to him Loki used to go down to Svartheim, the Dwarfs' dwelling below the earth. And now that he was commanded to restore to Sif the beauty of her hair, Loki thought of help he might get from the Dwarfs.
Down, down, through the winding passages in the earth he went, and he came at last to where the Dwarfs who were most friendly to him were working in their forges. All the Dwarfs were master-smiths, and when he came upon his friends he found them working hammer and tongs, beating metals into many shapes. He watched them for a while and took note of the things they were making. One was a spear, so well balanced and made that it would hit whatever mark it was thrown at no matter how bad the aim the thrower had. The other was a boat that could sail on any sea, but that could be folded up so that it would go into one's pocket. The spear was called Gungnir and the boat was called Skidbladnir.
Loki made himself very agreeable to the Dwarfs, praising their work and promising them things that only the Dwellers in Asgard could give, things that the Dwarfs longed to possess. He talked to them till the little, ugly folk thought that they would come to own Asgard and all that was in it.
At last Loki said to them, "Have you got a bar of fine gold that you can hammer into threads—into threads so fine that they will be like the hair of Sif, Thor's wife? Only the Dwarfs could make a thing so wonderful. Ah, there is the bar of gold. Hammer it into those fine threads, and the Gods themselves will be jealous of your work."
Flattered by Loki's speeches, the Dwarfs who were in the forge took up the bar of fine gold and flung it into the fire. Then taking it out and putting it upon their anvil they worked on the bar with their tiny hammers until they beat it into threads that were as fine as the hairs of one's head. But that was not enough. They had to be as fine as the hairs on Sif's head, and these were finer than anything else. They worked on the threads, over and over again, until they were as fine as the hairs on Sif's head. The threads were as bright as sunlight, and when Loki took up the mass of worked gold it flowed from his raised hand down on the ground. It was so fine that it could be put into his palm, and it was so light that a bird might not feel its weight.
Then Loki praised the Dwarfs more and more, and he made more and more promises to them. He charmed them all, although they were an unfriendly and a suspicious folk. And before he left them he asked them for the spear and the boat he had seen them make, the spear Gungnir and the boat Skidbladnir. The Dwarfs gave him these things, though in a while after they wondered at themselves for giving them.
Back to Asgard Loki went. He walked into the Council House where the Dwellers in Asgard were gathered. He met the stern look in Odin's eyes and the rageful look in Thor's eyes with smiling good humor. "Off with thy veil, O Sif," he said. And when poor Sif took off her veil he put upon her shorn head the wonderful mass of gold he held in his palm. Over her shoulders the gold fell, fine, soft, and shining as her own hair. And the Æsir and the Asyniur, the Gods and the Goddesses, and the Van and Vana, when they saw Sif's head covered again with the shining web, laughed and clapped their hands in gladness. And the shining web held to Sif's head as if indeed it had roots and was growing there.