A Dharma name is a new name acquired during a Buddhist initiation ritual in Mahayana Buddhism and monk ordination in Theravada Buddhism. The name is traditionally given by a Buddhist monastic, but is also given to newly ordained monks, nuns and laity.
If the student doesn't have a relationship with the monastic teacher and the ceremony is a public one with a congregation present, their new name will tend to reflect the lineage/tradition rather than the individual person. When it is given by a monastic who knows the disciple, however, the name is often tailor-made.
In Burmese Buddhism, Dharma names (bwe) are in Pali and chosen by the head monk of the monastery in which one is ordained. The traditional Burmese naming system, in which the monastic's day of birth stipulates the first letter of one's name, is used to select the name.
In China, ordained monks and nuns automatically revert to using the surname "Shi" (釋) as in Shijiamouni (釋迦牟尼), the Chinese transliteration of Shakyamuni Buddha. Vietnam also follows this tradition for its monks and nuns by changing their surname to "Thích" as in Thích Ca Mâu Ni, the Sino-Vietnamese name for Shakyamuni. Likewise for the Sino-Mahayana tradition of Buddhism, the dharma name given upon ordination can reflect the lineage passed from the teacher to the student, this can result in being given several dharma names: one for usage publicly, one used especially to reflect the transmitted lineage, and a second dharma name that can also be used.
In Japan, other than the standard usage of dharma names for monastics and laity, it is also tradition for the deceased to receive a dharma name (戒名, kaimyō; lit. "precept name") written in Kanji from the priest. This name supposedly prevents the return of the deceased if his name is called. The length of the name depends also on either the virtue of the person's lifespan, or more commonly, the size of the donation of the relatives to the temple, which may range from a generally common name to the most elaborate names for 1 million yen or more. The high prices charged by the temples are a controversial issue in Japan, especially since some temples put pressure on families to buy a more expensive name. The kanji for these kaimyō are usually very old and rarely used ones, and few people nowadays (with the exception of Chinese persons) can read them.
In the Shaolin Temple, each subsequent generation takes the first part of their given name from a 70-character poem written by Xueting Fuyu. For example, the 32nd character in the poem is "Xing" (行), and all Shaolin Temple monks and disciples of that generation have the name Shi Xing ___. Shaolin Monk Shi Yan Ming uses the words from Sutras to name his disciples, including the Heart Sutra and 88 Buddhas Sutra.