As originally intended, Gnomes were going to be descended directly from Halflings, and were created when a group of Halflings discovered the underground city that would become their home. There was much discussion on this, and an early vote decided that Gnomes would be "an adventurous [Halfling] tribe [that] found caverns and passageways and began to explore them, eventually discovering and worshipping some creature that helped them unlock their magic potential."
I have nothing against the decision that was made and, in fact, anyone using the material here could add that in as a plot element. The current Tears of Blood Campaign Setting presents Halflings and Gnomes as two distinct races, but there is nothing to say they weren't connected far back in the distant past. Some things had to get left on the cutting room floor, and would only appear in those DM's campaigns who wish to use them.
A campaign Supplement about Gnomes and The Beneath is under construction and may indeed visit this topic.
The People of Ursoule
Humans – many and varied real-world cultural inspirations were used for the Humans of Ursoule
• The Eastern Humans
o Caltan –> Celtic; strong ties to nature and superstition, a simpler folk except when angered
o Kvrin –> Transylvanian [Hungarian]; gothic and moody, a hardy people in a harsh world
o Phoedran –> Greek; scholars and philosophers, and many legendary heroes and monsters
• The Western Humans
o Baran –> Arabian/Middle Eastern; primarily a desert dwelling people with some cities on the edges
o Yujung –> Oriental; ruled by an Emporer who is considered divine, enemies of the Omeshik
o Pahali –> Indian (Asian); an exotic people, with strange religions and customs
o Taeshin –> Viking/Samurai mixed; explorers, traders, and pirates tied together by the sea
• The Northern Humans
o Omeshik –> Eskimo/Mongol mixed; a fierce northern tribe, enemies of the Yujung
Dwarves – militaristic and clan-based, almost all Dwarves serve as mercenaries at some point in their lives, while all Dwarves are struggling to return their homelands to their former glory.
• Primary Clans
o The Imperial Guard - mixed Dwarven Clans
o Clan Grimstrider - Hill Dwarves
o Clan Nightiron - Mountain Dwarves
o Clan of Nine Father’s Sons – Hill Dwarves
o Clan Rockdweller – Mountain Dwarves
o Clan of Twelve Axes - Hill Dwarves
o Clan Wanderforge - Mountain Dwarves
Other lesser known Clans are: Axehammer, Coalfist, Cogbeard, Darkiron, Deepaxe, Deeprock, Dragonbolt, Dreadspeaker (a clan devoted to Divination), Flintfire, Gravefiller, Hammersmith, Homura (Yujung Empire), Ironhammer, Red Hammer, Silvereyes, Stoneshield, Stormspear, Trueforge, White Axe, White Blade, Whitebeard and Wildhammer.
Elves – created when a group split from the Feldarin after a “Ritual,” one contributor suggested that "ELF" was an acronym for "Extremely Long-lived Feldarin"
• The Vanimar - High Elves, the most common
• The Morvanima - Dark and secret, a distant reflection of Drow Elves, reclusive and (perhaps) evil
• The Ranamar - High Elves, or maybe Half-Elves, though only as inspiration, "Half-Elves" don't exist here
• The Albion - Gray Elves, legendary, believed all gone, the original group that partook in the "Ritual" that created the Elves
Giantkin – an original Tears of Blood race, descended from Giants. They have a tribal culture and no distinct central government.
Gnomes – began as the standard race in the distant past, now changed somewhat by exposure to arcane power and ruled over by an ancient Dragoness deep underground in an area called "The Beneath"
• Nethergnomes – dwellers of The Beneath, use "Netherships" to navigate the tunnels and passages
1. Maqtar Clan, “the most stern and dour of Gnomes”
2. Kalmat Clan, “subtlety and guile are prized over strength, and bloodless victories the best”
3. Qaqq Clan, “quiet, reserved, and studious”
• Aethergnomes – an offshoot of Nethergnomes, use "Aetherships" to sail the skies above Ursoule, they are a recent developement, and some speculate that they are the result of some schism among the Gnomes
Halflings – rulers of the seas, the names below describe their lifestyle, not appearance, though some non-Halflings use them interchangeably (doing so is taken by some Halflings as an insult)
• Lightfoots – what adventuring Halflings are called due to their always being on the move. Plural is "Lightfeet"
• Mudfoots – land dwellers (called “landlubbers” by the Tarfoots) Plural is "Mudfeet"
• Tarfoots – ship dwellers (called “brineys” by the Mudfoots) Plural is "Tarfeet"
Orrks - replaced the standard ½ Orcs, all have Central American based cultures, with differing Alignments and Societies
• Xeriktotl - Aztec
• Therikoltec - Inca
• Telochiltadar - Tolmec
• Xencotengor - Mayan