For Malcolm, changing his surname to X was a symbolic gesture, rejecting the “slave” name of Little that had been his surname since birth. The decision to make the change stemmed from Malcolm’s discovery of the “Lost-Found Nation of Islam”, or the Black Muslims. It was while he was in jail that he undergoes this spiritual reawakening and is influenced by the teachings of the Honorable Elijah Muhammad.
It is interesting to note that Malcolm later grew disillusioned with the organization which had inspired him to trade “Little” for “X”. In the aftermath of the assassination of John F Kennedy, he made statements which led to his suspension from the Nation of Islam. After experiencing another spiritual transformation in Mecca, he changed his name once again, this time to El-Hajj Malik El-Shabazz.
Later, he became the founder of the Organization of Afro-American Unity, which believed racism, rather than white people, to be society’s biggest problem. Looking back as far as Malcolm’s teen years, one can see the significance of this. Malcolm spent these formative years in the worlds of Boston, Chicago and Harlem, where racial segregation and prejudice had a hugely debilitating impact on African-American people in the 1940s and 1950s.
It is perhaps ironic that Malcolm X was ultimately assassinated by a member of the Black Muslims—the very organization which had had such a profound impact on him as to lead him to change his name.
In contrast to his contemporary, Martin Luther King, Malcolm X was, often justifiably, incredibly rueful of the white influence of the culture of black Americans. While in prison, he had become convinced that every interaction that he'd ever had with a white person was inherently dishonest. Due to this, he had become so resistant and openly spiteful of religion that fellow inmates had taken to calling him "Satan." However, due to the common beliefs of the Nation of Islam in the return of the African Diaspora to their homeland through self-empowerment, Malcolm X eventually became a Muslim.
For black Muslims of the nation, it was common practice to sign one's surname as an X, as Elijah Muhammad, the leader of the Nation, would reveal a true Muslim's name to them in time. Malcolm X is said to have believed that the X stood in place of his ancestral African name that he could never know, and he would not be named Little, which was, to his mind, just the name of some "blue-eyed devil" that had owned him.
The X is meant to symbolize Malcolm's true family name from Africa, which he does not know, since white slave traders violently severed his family.
In his autobiography, Malcolm X writes,
"X" replaced the white slavemaster name of "Little" which some blue-eyed devil named Little had imposed upon my paternal forebears. The receipt of my "X" meant that forever after in the nation of Islam, I would be known as Malcolm X. Mr. Muhammad taught that we would keep this "X"...
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until God Himself returned and gave us a Holy Name from His own mouth.
He speaks about hearing Elijah Muhammad speak about how black men in America were mentally, morally, and spiritually dead because of their mistreatment and brainwashing by white people. One of the things Muhammad discussed that Malcolm X took note of was how black people weren't able to keep their family names. Their names were replaced with the names of the slaveowners who purchased them.
Muhammad believed that the true knowledge of themselves would help lift up black men in America. Malcolm X learned about the Nation of Islam while he was in prison. He converted and, in the process, changed his name. Later in life, he converted from the Nation of Islam to standard Islam. At that point, he began using the name El-Hajj Malik El-Shabazz.
Malcolm's original family surname was Little. When in prison, he became part of the Nation of Islam. This religious group believed that blacks had originally been Muslims when taken captive and brought to America as slaves. The group wanted to separate itself from white culture and promote black culture and independence.
Malcolm actually legally changed his last name from Little to X when he was released from prison in 1952. He felt that Little was a name that had been imposed on his family in the past by white slaveowners. The last name X brought him back, he thought, to his lost African roots and helped him develop a sense of black pride and separation from white culture. It worked out to be a distinctive name that helped him remain memorable after he rose to prominence.
I assume you are asking about the "X" in Malcolm X's name.
The use of "X" as a last name was started by the Nation of Islam. The idea of using the "X" was that African Americans' real last names had been lost because of slavery. Whatever last names they had had in Africa did not come with them.
Instead, many African Americans carried last names given them by their masters. For this reason, some in the Nation of Islam referred to their last names as "slave names." Instead of continuing to use these "slave names" they took the name "X" as a way of rejecting slavery and symbolizing what they had lost when their ancestors were enslaved.