Niflheim's cosmological role comes primarily from Snorri's Gylfaginning, which describes the primordial state of the cosmos and the creation from the collision of ice and fire. Völuspá and the Vafþrúðnismál also reference the primal realms. Note that Niflheim and Niflhel (the realm of the dead) are sometimes conflated in the sources — they may be distinct or connected regions.
Before the World
In the beginning, there was Ginnungagap — the void, the yawning gap, the primordial nothing. Into Ginnungagap grew two forces: in the north, Niflheim, cold and misty; in the south, Múspellsheimr, hot and bright with fire. They are the poles of existence — ice and fire, darkness and light, the primal duality that precedes all divine order.
Niflheim is described as having existed long before the earth was made. At its center lies Hvergelmir — the Roaring Cauldron — the source of the eleven rivers called the Élivágar (ice waves). These rivers flowed out from Hvergelmir and into Ginnungagap, freezing as they went. When the frozen rivers met the warmth of Múspellsheimr's sparks, the ice melted and dripped. From that dripping came the first life: Ymir, the primordial giant, and the cow Auðhumla who fed him with her milk.
The Norse creation is not a divine act of will — not God speaking the world into being from nothing. It is a physical process: two primal forces meeting in a void, their interaction producing drips of water, those drips forming the first life. The gods come later, descendants of the first being who emerged from the collision of ice and fire. Niflheim is older than everything except Múspellsheimr.
Hvergelmir — The Source of All Rivers
Hvergelmir sits at the third root of Yggdrasil, which reaches into Niflheim. From it flow the eleven Élivágar rivers, whose names are catalogued in Gylfaginning: Svöl, Gunnþrá, Fjörm, Fimbulþul, Slíðr, Hríð, Sylgr, Ylgr, Víð, Leiptr, Gjöll. The last river — Gjöll — runs near the gates of Hel, and the bridge over it (Gjallarbrú) is the boundary between the living and the dead.
The dragon Níðhöggr gnaws at Yggdrasil's root that reaches into Niflheim and feeds on the corpses of murderers and oath-breakers in Náströnd. He is the oldest destructive force in the cosmos — not evil in a moral sense, but the principle of decomposition that operates alongside Yggdrasil's life. The world-tree is being consumed from the root; what it means is being eaten at the foundation; the squirrel Ratatoskr carries messages of slander between Níðhöggr below and the eagle atop the tree, and neither knows the other is also at work in the same direction.
Niflheim and Niflhel
There is a distinction in the sources — sometimes clear, sometimes blurred — between Niflheim (the primordial mist-world) and Niflhel (mist-Hel, the lowest realm of the dead). The goddess Hel rules a realm called simply Hel, which may overlap with or be located within Niflheim. The sources are inconsistent. Snorri places Hel's realm "downward and northward," which is consistent with Niflheim's location in the cosmic geography.
What is clear: the cold, dark, and misty north-below is both the origin of the world (Niflheim's rivers created the first life) and its terminus (the dead go to a realm in the same direction). The world begins in cold mist; many of the dead return to it. The Norse cosmological map is circular in this way — the beginning and the end occupy the same geographic pole.