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A house-elf (sometimes also referred to as just elves) is a magical creature which is immensely devoted and loyal to the one designated as their master.
House-elves serve wizards and witches and are usually found under the employment of old wizarding families taking residence in elaborate establishments, like mansions, and must do everything that their masters command unless they are freed.
It is implied that with a wand and the proper knowledge, a house-elf may be able to do other magic, as Winky was falsely accused of using the Morsmordre spell to conjure the Dark Mark.
A house-elf must obey any commands given to them by their masters.
When a house-elf is mistreated, they will typically work just enough to obey their master's commands.
However, if even the slightest loophole can be found in a master's orders, house-elves that are unhappy with their master will exploit that loophole to their advantage.
In addition, Voldemort framed the house-elf Hokey for the murder of Hepzibah Smith.
Also, Horace Slughorn made a house-elf test of his bottles of mead for poison (although he likely had antidotes on hand).
When Sirius Black was killed in 1996, Harry Potter inherited the House of Black's servant Kreacher.
The best way for a master to ensure full loyalty and compliance with their orders is to simply treat them properly.
This was evidenced in 1997, when Hermione Granger convinced Harry Potter to be nicer to Kreacher.
To symbolise this, they usually wear makeshift clothes made with found objects such as pillowcases and rags.
These clothes can become quite filthy, and yet the house-elf will not clean their clothes to further express that they have no needs which are not specifically commanded to them by the master.