Lutherans derive their name from the founder of the Reformation, Martin Luther. However, Luther himself never wanted the church which followed his reforms to be named after him. The name "Lutheran" was first used by the Roman Church as a pejorative against those who followed the heretic (in their eyes) Martin Luther.
Luther, rather wanted those churches which carried out his reforms to be called Evangelicals, that is "Gospel Christians. Today this term, "Evangelical," usually refers to non-denominational Christians, but historically, it was first used by Lutherans. And in some quarters you will continue to hear Lutherans refer to themselves as Evangelical Lutheran Churches or as Evangelical catholics.
That is because Luther and those churches of the Reformation after him, are centered on the Gospel. The Good News of what God has done, is doing, and will promise to do for us in Jesus Christ. That by His life, suffering, death and resurrection, Jesus saves us and gives to us the free gift of salvation. Thus Luther writes in the Small Catechism on the Second Article of the Creed, "I believe that Jesus Christ, true God, begotten of the Father from eternity, and also true man, born of the Virgin Mary, is my Lord, who has redeemed me, a lost and condemned person, purchased and won me from all sins, from death, and from the power of the devil; not with gold or silver, but with His holy, precious blood and with His innocent suffering and death, that I may be His own and live under Him in His kingdom and serve Him in everlasting righteousness, innocence and blessedness, just as He is risen from the dead, lives and reigns to all eternity."
This Gospel comes to us in many ways, but chiefly in and through God's Holy Word (Bible) and the Holy Sacraments (Baptism, Absolution, Holy Communion).
For a deeper article on how we understand the Bible, click here.
As Lutherans, one of the ways we talk about the Bible is by talking about Law and Gospel. What do we mean by this? We mean that God's Word, the Bible, addresses Christians (and all people) in two ways through words of Law and words of Gospel. By God's Holy Law, we are shown our sins. His Law gives to us His will for our lives and because of that it shows us how far we've missed the mark. The Law speaks God's judgment against our unrighteousness. Now this word of Law is not confined to any Testament. We find God's Law addressing us in the New Testament, just as we do in the Old. The Law shows us that we are sinners and that we are in need of a savior.
That is then the gift of the Gospel. The Gospel, too is found throughout the testaments, because the whole Bible speaks to us of Jesus Christ. The Gospel is God's good news that He saves and forgives sinners. The Gospel is God's promise of our salvation given to us in the person of Jesus Christ. God's Word wants to expose our sins and show us how desperately we need Him (the Law), and it also wants to show us that He is already there to aid us and save us (the Gospel).