The Iktomi
"At night, especially if the moon is bright, you can sometimes hear the light tap-tap-tap-ping of the dwarf's hammer chipping the flints into shape."
From There Be Hodags, by C.A. McAllister:
The iktomi are a strange piece of Dakota folklore, given that “Iktomi,” meaning “Spider,” is the given name of a prominent spider spirit and trickster figure also found in Dakota stories. Yet “iktomi” is also said to be the name of a species of spider dwarves associated with flint and flint-craft. Further confusing the matter is the fact that the trickster Iktomi is associated with a different type of little people found in Dakota folklore, the canoti.
The iktomi were a type of little people who took the form of spiders when not hard at work crafting flint arrowheads, which they shared freely with the Dakota. They had underground workshops, found inside hollow rocks, where they continuously worked chipping away at flint in order to fashion arrowheads. They could sometimes be seen running through the grass and brush, and the constant rapping of their hammers could sometimes be heard at night. In their spider forms, they wove webs in grasses and bushes in order to mark pathways and locations for one another.
From Wigwam Tales, by Charles E. Brown:
Flint arrow points were made in the old days by the Iktomi. They supplied the Indians with arrows. They are little people, dwarfs, who turn into spiders when not busy at their labors. One can often see them running about among the leaves and grass. It brings bad luck to step on them. They do not wish to be seen so they transform themselves in this way. "At night, especially if the moon is bright, you can sometimes hear the light tap-tap-tap-ping of the dwarf's hammers chipping the flints into shape. There are regular quaries where these "little men" work--usually in the side of a sandy hill." They do not like to be disturbed when they are at work. Once a party of Indians were digging into a hill when they struck rock. To their surprise it sounded hollow. Breaking through the rock they found a cavity. It was filled with arrow heads. It was a workshop of the Iktomi or Spider Men. The Iktomi are still about but they no longer make arrows for the Indians. They have chiefs and a language of their own. They sometimes spin webs through the grass or from a bush to a bush to guide them in the daytime in going from place to place.