According to the Torah, after Avram entered into his bris with G-d, G-d changed his name to Avraham (translates to: "father of a multitude of nations"). The tradition therefore is for the baby to receive his Hebrew name at the time of his bris. The baby’s Hebrew name defines his spiritual identity and so it must be chosen with great care.
The only rule to remember about naming a baby is that there are no rules. However, there is one important custom. Ashkenazic Jews typically name a child after a dearly departed relative, and Sephardic Jews name after a living relative if possible.
"Ashkenazic Jews- the Jews of Germany, France, Russia, England and other Eastern European countries and their descendents – adhere closely to an old Jewish believe that a man's name is the essence of his being; the name is his soul. When a child is given a relative's name, he is also being given the relative's soul."- The New Name Dictionary by Alfred J. Kolatch.
You may choose one, two or even three names, and you may select them based on phonetics or meaning. Many parents consult with their rabbi. He or she can help you in choosing a name appropriate to your family's uniqueness as well as a name that is reflective of your own personal thoughts and hopes. I am also more than happy to help translate a name.
If you plan on naming your son after a relative, it is best to use the exact name or a name very similar. – This is in order to preserve the tradition in family. In some cases, it may be useful for the family to contact the cemetery where the loved one is buried in order to get the exact name from the burial stone.
I find it to be especially meaningful for the family to mention, during the naming portion of the ceremony, who they named the baby for and why, as well as the characteristics or attributes they would want their son to inherit from this person/people.
A couple good resources for naming:
The New Name Dictionary by Alfred J. Kolatch., Jonathan David publishers Inc. Middle Village, NY 11379
And a very useful website -HebrewName.org
Call your Rabbi!