legend; traditional story; handed-down tale
A story or legend that has been passed down orally or through tradition. Often carries a sense of being transmitted from person to person over time.
An old legend remains in this village.
I told the children a traditional story I heard from my grandmother.
Compound of 伝え (tsutae, 'conveying, passing on') + 話 (hanashi, 'story, talk'). The exact historical derivation is uncertain, but the word transparently means 'a story that is passed down'.