In her essay on Aldous Huxley, which I blogged about yesterday, Margaret Atwood revisits the origins of the word ‘utopia’. Obviously it’s by Thomas More, and obviously it’s from the Greek. The conventional wisdom is that it means “no place”, from the Greek ou-topos, but there has been a recurring minority view that said it was from eu-topos (‘good place’) instead.
It has often been taken to mean good place, through confusion of its first syllable with the Greek eu as in euphemism or eulogy. As a result of this mix-up, another word dystopia has been invented, to mean bad place. But, strictly speaking, imaginary good places and imaginary bad places are all utopias, or nowheres. [His emphasis]
(He does go on to say that dystopia is a useful word despite being coined out of confusion, and he uses it freely in the book).
Atwood makes a more interesting suggestion: Thomas More could have been playing on the Greek words:
Sir Thomas More, in his own 16th-century Utopia, may have been punning: utopia is the good place that doesn’t exist.