This post was both requested and is highly interesting to me. As soon as the Bolsheviks took power, they began organizing labor camps as early as 1919. Once Lenin died and Stalin (whose name means steel) took power, he began to standardize the labor camps, setting up an administration to deal with it. This administration, formed in 1931, was called the glavnoe upravlenie ispravitelno-trudoykh lagerei, which meant "main administration of labor camps". Since that was a mouthful, they took those letters I bolded and abbreviated that mouthful to gulag. Soon, through metynomy, that administration's cool new name got applied to the camps themselves. Later on in the '70s, newly-McCarthyist Americans picked up the word to showboat the atrocities of the Communists, and that's how gulag entered US pop culture. Suprisingly, the stylization Gulag is much more prevalent than gulag or GULAG, and usage has plateaued recently.
Adam Aleksic, a rising sophomore studying linguistics and government at Harvard University, has been described as the internet's sixth most famous etymologist. He also has disturbing interests in politics, vexillology, geography, board games, conlanging, and law.