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Liam is a short form of Uilliam, the Irish language form of William. Back in the 1400s the diminutive of Uilliam seems to have been Uillec. I don't have good information on when Liam became the more common pet form in Ireland, but it does not seem to have been used as a birth certificate form before the late 19th century.

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https://omaha.com/lifestyles/cleveland-evans-irish-nickname-liam-on-international-rise/article_2556ef6f-4922-59df-8ec7-461b6373bdcb.html