It was the wartime year of 1943 when Kelly Johnson brought together a hand-picked team of Lockheed Aircraft Corporation engineers and manufacturing people to rapidly and secretly complete the XP-80 project. Because the war effort was in full swing there was no space available at the Lockheed facility for Johnson’s effort. Consequently, Johnson's organization operated out of a rented circus tent next to a manufacturing plant that produced a strong odor, which permeated the tent.
Each member of Johnson’s team was cautioned that design and production of the new XP-80 must be carried out in strict secrecy. No one was to discuss the project outside the small organization, and team members were even warned to be careful how they answered the phones.
A team engineer named Irv Culver was a fan of Al Capp's newspaper comic strip, "Li'l Abner," in which there was a running joke about a mysterious and malodorous place deep in the forest called the "Skonk Works." There, a strong beverage was brewed from skunks, old shoes and other strange ingredients.
One day, Culver's phone rang and he answered it by saying "Skonk Works, inside man Culver speaking." Fellow employees quickly adopted the name for their mysterious division of Lockheed. "Skonk Works" became "Skunk Works."
The once informal nickname is now the registered trademark of the company: Skunk Works®.