Middle English mirie, from Old English myrge "pleasing, agreeable, pleasant, sweet, exciting feelings of enjoyment and gladness" (said of grass, trees, the world, music, song); also as an adverb, "pleasantly, melodiously," from Proto-Germanic *murgijaz, which probably originally meant "short-lasting," (compare Old High German murg "short," Gothic gamaurgjan "to shorten"), from PIE root *mregh-u- "short." The only exact cognate for meaning outside English was Middle Dutch mergelijc "joyful."
The connection to "pleasure" likely was via the notion of "making time fly, that which makes the time seem to pass quickly" (compare German Kurzweil "pastime," literally "a short time;" Old Norse skemta "to amuse, entertain, amuse oneself," from skamt, neuter of skammr "short"). There also was a verbal form in Old English, myrgan "be merry, rejoice." For vowel evolution, see bury (v.).
Not originally applied to humorous moods or speech or conduct, yet the word had a much wider senses in Middle English than modern: "pleasant-sounding" (of animal voices), "fine" (of weather), "handsome" (of dress), "pleasant-tasting" (of herbs). The evolution of the modern senses is probably via the meaning "pleased by a certain event or situation or state of things" (c. 1200). Of persons, "cheerful by disposition or nature; playfully cheerful, enlivened with gladness or good spirits," by mid-14c.
Merry-bout "an incident of sexual intercourse" was low slang from 1780. Merry-begot "illegitimate" (adj.), also "bastard" (n.) are in Grose (1785). Merrie England (now frequently satirical or ironic) is c. 1400, meri ingland, originally in a broader sense of "bountiful, prosperous." Merry Monday was a 16c. term for "the Monday before Shrove Tuesday" (Mardi Gras).
"a buffoon; a zany; a jack-pudding" [Johnson], "One whose business it is to make sport for others by jokes and ridiculous posturing" [Century Dictionary], according to OED, in early use properly a mountebank's assistant, 1670s, from merry + masc. proper name Andrew, but there is no certain identification with an individual, and the name here may be generic.
to be "born within the sound of Bow Bells" is the traditional (since early 17c.) definition of a Cockney; the reference is to the bells of the church of St. Mary-le-Bow in London's Cheapside district. A church or chapel probably stood there in Anglo-Saxon times, and was rebuilt many times; the bells were noted for their sound from 16c., and a great tenor bell hung there from 1762 to 1941, when the church was most recently destroyed, in a German air raid. The church is so called for the arches which were a notable feature in the medieval building from 12c., hence it is from bow (n.1).
"amorous or designing widow," 1907, from the English title of Franz Lehar's operetta "Die Lustige Witwe" (1905). "The Lusty Widow" would have been more etymological (see lust (n.)), but would have given the wrong impression in English. Meaning "a type of wide-brimmed hat" (popularized in the play) is attested from 1908.
"a revolving machine consisting of wooden horses or seats mounted on a circular platform," 1729, from merry (adj.) + go-round. Figurative use by 1838. Merry-totter (mid-15c.) was a Middle English name for a swing or see-saw. Also compare merry-go-down "strong ale" (c. 1500); merry-go-sorry "a mix of joy and sorrow" (1590s).
"one who is crazy," 1940, from earlier adjective (1935), from noun meaning "the sound of little bells" (1894), ultimately imitative of the tinkling sound (by 1848; see ding (v.)). The extended senses are from the notion of hearing bells in the head.