The word Rudraksha has its etymological beginnings in the Sanskrit
words "Rudra" and "Aksha" meaning Lord Shiva and
Teardrops respectively. According to "Shiva Purana", Lord Shiva once went into deep meditation for the well being of all living creatures. When he woke up, he opened his eyes and tear drops fell on the Earth. These tear drops took the form of seeds that later on became the Rudraksha tree.
The Shaivite sect of Hinduism has a story about Shiva shedding a tear on viewing the misfortunes of humanity. That single tear became the Rudraksha tree and a symbol of his compassion.
Another tale about Rudraksha tells about Lord Shiva destroying the fortress of the demon "Tripurasur". Lord Shiva had to use a very powerful weapon - "Aaghor" to kill Tripurasur. This weapon created mayhem and destructed everything. On realising the hapless plight of living beings, tears fell from Lord Shiva's eyes in compassion. Thus, Rudraksha tree was formed. Rudraksha literally stands for the eyes of Shiva implying that since it was pleasant to the eyes of Rudra, it was named in his honor.
Lord Shiva is always portrayed wearing rosaries of Rudraksha beads on his head, arms and hands. With this came the religious, spiritual, physical and materialistic significance of Rudraksha. It is believed that the seed of Rudraksha contains the secrets of entire evolution of the cosmos within it. The sages have been wearing Rudraksha for centuries to cultivate mental, physical and health prowess to attain fearlessness on their spiritual path to enlightenment.
According to "Shiv Purana", it is said that the one who wears a Rudraksha around his hands, arms and head cannot be killed by a living being. He would fearlessly roam the world in the form of Rudra and be respected and honored by all.