Lexicalization is the process of adding words, set phrases, or word patterns to a language - that is, of adding items to a language's lexicon.
Whether or not word formation and lexicalization refer to the same process is a source of controversy within the field of linguistics. Most linguists assert that there is a distinction, but there are many ideas of what the distinction is. Lexicalization may be simple, for example borrowing a word from another language, or more involved, as in calque or loan translation, wherein a foreign phrase is translated literally, as in marché aux puces, or in English, flea market.
Other mechanisms include compounding, abbreviation, and blending. Particularly interesting from the perspective of historical linguistics is the process by which ad hoc phrases become set in the language, and eventually become new words. (See lexicon for details.) Lexicalization contrasts with grammaticalization, and the relationship between the two processes is subject to some debate.
In psycholinguistics, lexicalization is the process of going from meaning to sound in speech production. The most widely accepted model, speech production, in which an underlying concept is converted into a word, is at least a two-stage process.
First, the semantic form (which is specified for meaning) is converted into a lemma, which is an abstract form specified for semantic and syntactic information (how a word can be used in a sentence), but not for phonological information (how a word is pronounced). The next stage is the lexeme, which is phonologically specified.
Some recent work has challenged this model, suggesting for example that there is no lemma stage, and that syntactic information is retrieved in the semantic and phonological stages.