What is a portmanteau?

A portmanteau or portmanteau word is a combination of two or more words, and their definitions, into one new word. The word “portmanteau” comes from the English portmanteau luggage, which is a piece of luggage comprised of two compartments.

The earliest use of the word “portmanteau” in this context was by Lewis Carrol in the book Through the Looking Glass. In it, Humpty Dumpty explains to Alice the coinage of unusual words.

You see it’s like a portmanteau—there are two meanings packed up into one word.

Many portmanteau words come and go without making their way into the general public’s day to day vocabulary, however some portmanteau words have made it to the big time.

Portmanteau words are now a staple of the magazine competition, and amid the waste of failed invention, every so often one meets a need: smog, stagflation, chocoholic. I don’t know how we ever did without ‘metrosexual’, coined by my friend Mark Simpson.
Philip Hensher, “Sarah Palin’s Struggle with the English Language,” The Telegraph, July 21, 2010

While the practice of merging or blending words goes on all the time, recently some bigger names have come under fire for it. For example Sarah Palin coined the term “refudiate”, which Urban Dictionary describes as;

Refudiate bridges the gap between “refuse” and “repudiate”, to mean exactly what she wants it to mean.
Urban Dictionary