The Hobbits of the Shire and Bree had developed their own system of names, most noticeably the use of family surnames which was an unusual custom in Middle-earth, and one that was only a few centuries old at the time of the War of the Ring. In some families the use of a formal surname went back only a few generations (so, for example, Sam Gamgee's grandfather Hobson was the first of his family to use the name 'Gamgee', and then only as a nickname).
It is important to note that, for the most part, the familiar names of Hobbits from Tolkien's works would not have been recognised by those Hobbits themselves: as part of his 'translation' Tolkien adapted many of the original names (which have a rather alien feel to a modern reader) into more familiar forms. So, for example, Banazîr Galpsi was the true name of 'Samwise Gamgee', while Kalimac Brandagamba became 'Meriadoc Brandybuck' and so on.
Many of these original names, especially those of male Hobbits, held no direct meaning even to the Hobbits themselves, but often some adjustment has nonetheless been made, especially due to the convention of using -a as a masculine ending (for example, the original form of the name 'Bilbo Baggins' would probably have been Bilba Labingi). In these cases -a is translated to -o (so 'Bilba' becomes 'Bilbo', which would have sounded like a feminine name to a Hobbit of the Shire).
For female Hobbits, it was customary to give the names of jewels and flowers, and these are generally translated directly into English (hence 'Amethyst', 'Diamond', 'Ruby', 'Lobelia', 'Myrtle', 'Primula', 'Rose', and many similar examples). Among the more important families, it was customary to take high-sounding names of legendary figures, or using historic tongues; in translation, these names appear in suitably ancient forms relative to English, coming from languages such as Gothic, Latin or Celtic (giving us names such as 'Isumbras', 'Gerontius' or 'Marmadoc').
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