"The Three Little Men in the Wood" or "The Three Little Gnomes in the Forest" is a German fairy tale collected in 1812 by the Brothers Grimm (KHM #13).Andrew Lang included it in The Red Fairy Book (1890) as "The Three Dwarfs," and a version of the tale appears in A Book of Dwarfs (1964) by Ruth Manning-Sanders.
It is Aarne-Thompson type 403B, the black and the white bride, and includes an episode of type 480, the kind and the unkind girls.
A woman offered marriage to a widower with a daughter, saying that her own daughter would drink water and wash in water, while the man's daughter would drink wine and wash in milk. The man gave his daughter a boot with a hole in it, and told her to take it to the barn and fill it with water; if it held the water, he would remarry, and if not, he would not. The water pulled the hole together, and the boot held it, so he remarried.
The woman kept her promise one day; the second day, both girls drank and washed in water; the third and after, the stepdaughter drank and washed in water, while the daughter drank wine and washed in milk. One winter day, the stepmother ordered her stepdaughter to wear a dress of paper and seek strawberries in the wood, giving her only a piece of hard bread to eat.
While in the wood, the girl met three little men. She politely asked permission to come into their home, which they gave. Inside, she sat by the fire and began to eat the bread. The three men asked for her to give them some, and having a kind heart, the girl did. The little men directed her to sweep the back steps, and she did so, and - to her great surprise - found the strawberries for which she had been searching. The little men wanted to reward the girl for her kindness, so they each spoke a wish: one declared that she should grow more beautiful every day, the other declared that a gold piece should fall from her mouth whenever she spoke, and the third declared that a king would marry her.
The girl returned home, only to be welcomed by the envy of her stepsister, who wanted the same fortune for herself. Her mother, however, would not allow her child into the cold wood, but the daughter insisted, so the mother gave her warm clothing and good food to take with her. The girl found the same little men, but refused to either share her food or sweep the back steps. The little men wanted to punish her for her haughtiness and one declared that she would grow more ugly every day, the other declared that a toad should fall from her mouth whenever she spoke, and the third declared that she would die a miserable death.