A backronym (sometimes bacronym) is a reverse acronym. To create one, you take a word that isn’t an acronym and create a fictitious expansion for it.
Some backronyms are designed as mnemonics. A classic example is the Apgar score to test the health of newborns. It was named after the American physician Virginia Apgar but to help student doctors and nurses remember the system, it has been changed to the acronym “Appearance, Pulse, Grimace, Activity, and Respiration”. Similarly, the US Amber Alert programme is said to mean “America’s Missing: Broadcast Emergency Response”, though it was actually named after a missing child, Amber Hagerman.
Backronyms are frequently humorous — Microsoft’s Bing, some quip, is actually an acronym for “Because It’s Not Google”; world-weary sailors say navy really means “Never Again Volunteer Yourself”, some car owners hold that Ford stands for “Fix Or Repair Daily”. Many of this type are actually reinterpreted acronyms, included by courtesy in the backronym collection because nobody has yet come up with a different -nym for them. For example, the name of the one-time Belgian national airline Sabena (which derives from “Société Anonyme Belge d’Exploitation de la Navigation Aérienne”, bless the guy who shortened it) was said to be an acronym for “Such A Bad Experience, Never Again”
Others are folk etymology: posh doesn’t stand for “Port Out, Starboard Home”. Wiki, the Hawaiian word that turns up in such sites as Wikipedia, doesn’t mean “What I Know Is”. Golf wasn’t created from “Gentlemen Only, Ladies Forbidden”. SOS doesn’t mean “Save Our Souls” or “Save Our Ship”, or indeed anything at all, since it was chosen as a particularly memorable and easily recognised Morse code sequence.
Meredith Williams, in an entry to a competition in The Washington Post on 8 November 1983, seems to have coined bacronym, as a portmanteau of back and acronym. Previously, lexicographer Ben Zimmer tells me, the form was called, somewhat cumbersomely, a prefabricated acronym as well as a reverse acronym. The word was popularised in July 1994 by another contest, in New Scientist, though it was then said to be a reinterpreted acronym, neither the original nor the current principal sense.