A pseudonym is a fictitious name most often associated with authors, though actors, singers, rappers, and even those in organized crime often use a pseudonym in lieu of the birth name. Pseudonyms are also used for practical reasons when the real name is not known, as in the case of the County Coroner labeling an unidentified body as a "John Doe" or a "Jane Doe."
Pseudonyms, or pen-names, are used in literature for a number of reasons, but most importantly for marketing. An author's readership expects his or her books to fall within a specific genre. If the author pens a novel outside that genre a pseudonym will keep the work separate. That way, the writer can build a fan base in both genres without disappointing fans with work that falls outside the realm of expectation. This facilitates fan loyalty, which translates to sales, and that keeps publishers happy.
Other authors like sisters Pamela and Mary O'Shaughnessy collaborate on fictional crime novels releasing them under the pseudonym of Perri O'Shaughnessy, a combination of their first names with a nod to Perry Mason.
Female authors sometimes assume an androgynous pseudonym or merely use their initials if they believe their gender might be a deterrent to gaining a readership. One such example is Joanne Kathleen Rowling, author of the Harry Potter series, who has stated publicly that [when her work was still unknown] she didn't believe little boys would be so apt to pick up a book written by a woman, and for those who did, they might get teased for liking it. She avoided the potential pitfall to success by simply leaving gender out of her pen-name. (Once her work became famous many boys were indeed surprised to learn that "J.K. Rowling" was a woman.)
Actors, singers and rappers often take a pseudonym (stage name) to create a persona different than their legal names would evoke. Norma Jeane Mortenson (then Baker) became Marilyn Monroe. Roy Herald Scherer Jr. became Rock Hudson. Marshall Mathers became Eminem. Often pseudonyms are legally adopted as replacements for the original name, especially in the entertainment industry.
Someone might also take a pseudonym for protection, as in the case of a whistle-blower. One of the most famous pseudonyms of the last century was Deep Throat, the unknown source that provided inside information regarding the Watergate scandal to Washington Post reporter Bob Woodward. The identity of Deep Throat remained a matter of speculation for over 30 years, until 31 May 2005, when former secret service official W. Mark Felt made history, by publicly claiming the pseudonym.
Pseudonyms that function closer to nicknames (names that are descriptive) are often taken among gang members where they provide a degree of anonymity. Organized crime also uses nicknames, often embedded in the actual name, such as Jimmy "The Weasel" Fratianno, Charles "Lucky" Luciano, and Benjamin "Bugsy" Siegel.