Etymology
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bedlam (n.)

"scene of mad confusion," 1660s, from colloquial pronunciation of "Hospital of Saint Mary of Bethlehem" in London, founded 1247 as a priory, mentioned as a hospital 1330 and as a lunatic hospital 1402; it was converted to a civic lunatic asylum on dissolution of the monasteries in 1547. It was spelled Bedlem in a will from 1418, and Betleem is recorded as a spelling of Bethlehem in Judea from 971. The proper name might be caught in transition in the title of John Davies' 1617 publication of humorous poetry, "Wits bedlam —where is had, whipping-cheer, to cure the mad."

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Definitions of bedlam
1
bedlam (n.)
a state of extreme confusion and disorder;
Synonyms: chaos / pandemonium / topsy-turvydom / topsy-turvyness
2
Bedlam (n.)
pejorative terms for an insane asylum;
Synonyms: booby hatch / crazy house / cuckoo's nest / funny farm / funny house / loony bin / madhouse / nut house / nuthouse / sanatorium / snake pit
From wordnet.princeton.edu