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The lake got its name from a settlement called Kinneret (Chinneret), which is first mentioned in an Egyptian list of Palestinian cities in 1500 BCE (cf. Joshua 19:35). Its name seems to derive from the name of a Cananite deity. The interpretation from "kinnor," harp, is obviously younger. It is assumed to have referred to the shape of the hill the city was built on. But this is rather uncertain.

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Sources:
Encyclopedia Judaica
Das große Bibellexikon, Wuppertal 1996