The American writer Sylvia Wright coined the term mondegreen in an essay "The Death of Lady Mondegreen," which was published in Harper's Magazine in November 1954. In the essay, Wright described how, as a young girl, she misheard the final line from the 17th century ballad "The Bonnie Earl O' Murray." She wrote:The most common mondegreen (and one which I was guilty of for many years) is Creedence Clearwater Revival's "There's a bad moon on the rise" misheard as "There's a bathroom on the right." In retrospect the item I blogged entitled "Joe Cocker with subtitles" is an assembly of (intentional) mondegreens.
When I was a child, my mother used to read aloud to me from Percy's Reliques, and one of my favorite poems began, as I remember:
Ye Highlands and ye Lowlands,
Oh, where hae ye been?
They hae slain the Earl Amurray, [sic]
And Lady Mondegreen.
The actual fourth line is "And laid him on the green." As Wright explained the need for a new term, "The point about what I shall hereafter call mondegreens, since no one else has thought up a word for them, is that they are better than the original."
Other well-known examples of mondegreens include Gladly, the Cross-Eyed Bear and Round John Virgin; for more, see the Wiki link, or just Google the term.
Other words and terms incorporated into the new dictionary include infinity pool (one whose edge appears to go to the horizon), pescatarian (vegetarian who eats fish), wingnut (political extremist), subprime, and dirty bombs. I haven't encountered a complete list, even at the Merriam Webster website.