Assuming we're on Earth (or something geologically and biologically comparable). Humans are at best in the middle ages, and there's no "magic" or advanced science.

Now the difference is, there is also a "dwarf" specie (presumably just some "humans" that split off from the main branch a few 1000 years ago). They don't like living on the surface, for whatever reason (could be as simple as "religion", for example). So they live underground, but presumably have shafts to the surface at regular distance (for fresh air, commerce with humans, ...)

So the question is: since they need to mine to "open up space" to allow their population to expand (and to gain resources, obviously), how do they get rid of all that stone? They would have so much of the stuff, that it's basically a waste product.

I can see 3 obvious options. I'm wondering which one is the most likely/realistic, or if I missed some other better option:

1. They could just dump it around the air shafts, and let the humans take whatever they want, if humans are around. Major issue here is, I believe it would take quite a lot of work to get the stones all the way up to the surface. That is, the stone transport would be *significantly more expensive* then the mining itself. They would eventually grow "mountains" near the air-shafts. I can't judge how long it would take before that becomes a problem.

2. They could sell it to the humans. The amount produced would drive the price down, but they can still sell it for *some* profit, if the stones are "perfectly cut" to be directly usable as "castle building material". Therefore they would need to build near (large) humans settlements, to have enough "buyers". The *transportation problem* is the same as above.

3. They need to find some natural "sinkholes" that are so large that they "never" fill up. I think those exist geologically, but idk how likely one is to find such a thing. In particular without access to modern technology to find them.

Alternatively, (more realistically?) they might just prefer to settle at the location of larges natural cave systems, where you get "space for free" and the mining is just enough to fill the caves with buildings. Idk how frequent those cave systems there are on Earth, but I would rather ignore that option.