A legend is a story, with important ontological consequences, passed by person to person.
A legend is a concept, an ideal or semi-true story with mythic qualities usually involving an heroic character or fantastic place and rooted in a kernel of truth; it is a meme that propagates through a culture.
Some legends we know today have their basis in historical fact. Before the invention of the printing press storytellers abounded, and typically would learn their stock in trade, their stories, from an older story teller, who might (or might not) have actually been there when the "story" was "history" bardic schools, oral history.
Legend is also the name of a 1984 fantasy novel by David Gemmell, his first novel featuring his character Druss the Legend.
Legend, a 1985 fantasy movie directed by Ridley Scott, tells of a young man (Tom Cruise) who must defeat the Lord of Darkness (Tim Curry). It is unrelated to the aforementioned novel.