Recorded as Ratley, Ratlee, and Ratleye, this is an English locational surname. It originates from a village called Ratley in the county of Warwickshire and first recorded in the famous Domesday Book of 1086 as "Rotelei". The name means Rota's farm, with Rot or Rote being a personal name meaning the merry one! Whether Rot was merry or not is something that we are very unlikely to find out, but given that it was originally an endearment name given at christening to a baby, it probably did not matter. However if it had been given as a nickname surname in later medieval times, it may well have meant the reverse of what it seemed to describe. Locational surnames are usually "from" names. That is to say names given to people after they left their original homes to move somewhere else. In this case the surname is well recorded in the surviving church registers of the city of London at least from Elizabethan times. Examples include John Ratley who married Joane Pengallye at St James Clerkenwell, on August 5th 1588, and William Ratlee, a christening witness at St Botolphs without Aldgate, on November 27th 1655, during the "reign" of Oliver Cromwell (1654 - 1658).
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