Montalvo called his island California because it was ruled by a beautiful queen called Calafia . In the Exploits of Esplandian , Calafia has been persuaded to bring her army of ferocious (and attractive) women, plus some trained griffins, to fight alongside Muslims and against Christians at the siege of Constantinople. However, Calafia falls in love with Esplandian, is defeated, taken prisoner and converts to Christianity. Then she returns to the island of California with her Spanish husband, and her trained griffins.
There are several theories as to why Montalvo chose the name Calafia , but by far the most convincing is that, as she was fighting alongside Muslims, her name was chosen to suggest or echo the title of the Muslim leader: the Caliph . So California is really, ultimately, etymologically the last surviving Caliphate .