Synthetic fiber spandex was discovered by chemist Joseph C. Shivers of DuPont. The original material was called Fiber K, and later DuPont named Lycra to signify their mix.
However, the general product has long been referred to as spandex. The substance was named because it works. Spandex is an anagram, blending the letters of a word to create a new word from the word "expanded".
Interestingly, the term "spandex" has prevailed only in the country of its invention: North America. In other parts of the world, fiber is most commonly referred to as "elastane" (or as a variant of it), which still alludes to the extreme elasticity of the material.