ye (pron.)
Old English ge, nominative plural of 2nd person pronoun þu (see thou); cognate with Old Frisian ji, Old Saxon gi, Middle Dutch ghi, Dutch gij. Cognate with Lithuanian jus, Sanskrit yuyam, Avestan yuzem, Greek hymeis.

Altered, by influence of we, from an earlier form that was similar to Gothic jus "you (plural)" (see you). The -r- in Old Norse er, German ihr probably is likewise from influence of their respective 1st person plural pronouns (Old Norse ver, German wir).
ye (article)
old or quaintly archaic way of writing the, in which the -y- is a 16c. graphic alteration of þ, an Old English character (generally called "thorn," originally a Germanic rune; see th) that represented the -th- sound (as at the beginning of thorn). The characters for -y- and -þ- so closely resembled each other in Old English and early Middle English handwriting that a dot had to be added to the -y- to keep them distinct. In late 15c., early printers in English, whose types were founded on the continent, did not have a þ in their sets, so they substituted y as the letter that looked most like it when setting type. But in such usages it was not meant to be pronounced with any of the sounds associated with -y-, but still as "-th-." Ye for the (and yt for that) continued in manuscripts through 18c. Revived 19c. as a deliberate antiquarianism; the Ye Olde _____ construction was being mocked by 1896.