1890, "arrangement," from the verbal phrase set up, which is attested from c. 1200 as "place in an erect position, place upright, make ready for use;" from set (v.) + up (adv.). From 19c. also "a favorable arrangement of the balls in billiards, etc., especially when left by one player for the next."
The verbal phrase is from 1520s as "begin business or enterprise." It also can or once could mean "to establish, found" (early 15c.), "make (a hawk) perch upright" (late 15c.), and "put (drinks, etc.) before customers or other patrons as a treat" (1880).
It is attested from 1950 (originally in pugilism) as "to bring (someone) to a vulnerable position, put (someone) in a position to be knocked down." It is attested by 1965 as "to contrive, plot." To set (someone) up "provide (someone) with means" is from 1520s. The adjective set-up "established" is attested by c. 1600.