When the Giants swarmed the world of Fellmir in ancient times, the races living in there had little means of defending themselves against the might of the Giants, most creatures either chose a nomadic life, constantly on the run from Giants, typically, Orcs and Hobgoblins, or they chose subjugation.
In southern Fellmir, the Elves, then only a single, united race, sat council, trying to find a solution for the Elves. Most of the Elven leaders were in agreement that fighting the Giants would lead to nothing but ruin (a few even suggested a full surrender, to allow the Elven race to survive). The debate seemed unending, until a group of the Elves highest ranking mages and scholars came up with a solution. If the mages were allowed to concentrate their magic, it would be possible to move every creature to “another place” as the mages explained it. However, the mages also warned that they couldn’t control the destination.
Meanwhile, as the Elves argued, the Giants marched ever closer. Scouting parties never returned and eventually, as things started to look dire, the mages were told to start the spell. In a matter of days, the Elves willing were wrapped in a slight glowing cloud. A few Elves had decided to fight until the very end for their forest-homes, however much persuasion was tried, these Elves couldn’t be moved.
This was the first time the Elves were split, the Wood Elves, the ones staying behind, have only been seen or heard from on rare occasions. It seems that though they took to helping fighting the Giants, but only when these were threatening their forests.
Any other Elves were teleported away, however, as the spell was rushed, large parts of the Elven society was split up. Most, later High Elves, ended in the Feywild, a land of wonders, but also one of savage creatures seeking to submit any and all minor races to their whim.
Two parts of the Elves ended on the Astral planes of the Beastlands and Arborea. The wild nature of the Beastland shaped the Elves into wanderers, loners, hermits in pact with nature and creatures, the Sun Elves for this reason are rare and finding two Sun Elves in the same place, is considered a myth. In Arborea, the Elves found themselves deep in thought, their feelings and emotions becoming more powerful and intense. As such Moon Elves tend to stick together in small, very tightly-woven groups, as they don’t feel understood by other Elves and even less so by other non-elves.
Finally there was the unfortunate ones, those few that was sent to the horrible place known as the Underdark. The harsh, unforgiving environment, filled with all manners of unspeakable horrors, turned the freedom-loving Elves, into the slave-hungry Drow, seeking to get work-slaves from the overworld, to build temples, shrines and statues in the dark mistress, Lolth’s image. Those that aren’t worked to exhaustion, are given as sacrifice to Lolth. A horrible and slow death, filled with the despair and knowledge, that no hope remains for them.