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The Garrison State of Niflheim (軍事国家ニフルハイム, Gunjikokka Nifuruhaimu?) is an opposing nation in Final Fantasy XV. It is a military dictatorship that attacks the capital of Lucis, Insomnia, during the peace treaty signing party, which would have settled the dispute over the last crystal. Presumably, this is only a ruse to enter Lucis and invade.
Niflheim, also called Niflheimr, is a location in Norse Mythology meaning "mist world". In the story of Gylfaginning, Odin explains that creation began when the ice of Niflheimr met the flames of Muspelheim. Nibelheim is literally translated as "fog-home" in German. "Nibel" is an old-fashioned way to pronounce "Nebel", the German word for "fog", but can also be translated as "cloud" resulting in "cloud home".