As elves seek perfection in everything, those who showed the changes were shunned, tormented and hunted by the rest of elves and were even forbidden from entering the shrines. Those elves quickly banded together and formed shadow societies where they endlessly pleaded the elf gods' for salvation and guidance. They both came, but from the darkest of sources. Chaos, who never really liked the elves, took pity on those outcasts and so he began protecting and guiding them which caused the Shadow elves to all begin worshiping him in place of their gods. When the pure elves heard of their corruption the Emperor Vasmat Lutius declared them enemies and sent a whole army to clear them out.
The corrupted elves fought back as best they could but within a year less then 2000 of them were left. There are several legends from that time which tell of the pure breed elves gutting and decapitating the dead and then mounting whats left of their bodies on wooden stakes, but the elves all deny that as lies spread by gnomes. Even if that didn't happen, Chaos vowed to allow all of his remaining followers escape so in 914bdc he ordered all of his Kost and 9 of his ice barges to attack the capital of Luana while the voids brought the rest of the corrupted elves to Evershifting Realms. The plan worked so well that, in addition to rescuing every single last of his followers, all 395,000 inhabitants of Luana, including the Emperor and his entire family, were mercilessly slaughtered within a single day and night. As the voids melding them away were the last thing the elves saw of their corrupted brothers, and because they hid in them so much, they were given the insulting name of shadow elves. Over time there numbers grew and now they are enough of them that they can extract revenge on their pure brothers.