章 (chapter/pattern) + 鱼 (fish) — a fish with patterns on its body. Octopi do have remarkable color-changing patterns on their skin!
usage
Don't confuse with 鱿鱼 (yóuyú, squid). 章鱼 has a round body and 8 arms; 鱿鱼 has an elongated body and 10 tentacles. In food contexts, 章鱼烧 (zhāngyúshāo) is takoyaki (octopus balls).