Originally founded by the ancient Egyptians as Shedet, its current name in English is also spelled as Fayum, Faiyum or Al Faiyūm. Faiyum was also previously officially named Madīnet Al Faiyūm (Arabic for The City of Faiyum). The name Faiyum (and its spelling variations) may also refer to the Faiyum Oasis, although it is commonly used by Egyptians today to refer to the city.

The modern name of the city comes from Coptic ̀Ⲫⲓⲟⲙ /Ⲡⲉⲓⲟⲙ epʰiom/peiom (whence the proper name Ⲡⲁⲓⲟⲙ payom), meaning the Sea or the Lake, which in turn comes from late Egyptian pꜣ-ym of the same meaning, a reference to the nearby Lake Moeris; the extinct elephant ancestor Phiomia was named after it.