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bit (n.1)

"small piece," c. 1200; related Old English bite "act of biting," and bita "piece bitten off," which probably are the source of the modern words meaning "boring-piece of a drill" (the "biting" part, 1590s), "mouthpiece of a horse's bridle" (mid-14c.), and "a piece (of food) bitten off, morsel" (c. 1000). All from Proto-Germanic *biton (source also of Old Saxon biti, Old Norse bit, Old Frisian bite, Middle Dutch bete, Old High German bizzo "biting," German Bissen "a bite, morsel"), from PIE root *bheid- "to split."

Meaning "small piece, fragment" of anything is from c. 1600. Sense of "short space of time" is 1650s. Theatrical bit part is from 1909. Money sense "small coin" in two bits, etc. is originally from the U.S. South and the West Indies, in reference to silver wedges cut or stamped from Spanish dollars (later Mexican reals); transferred to "eighth of a dollar."

bit (n.2)

computerese word, 1948, coined by U.S. computer pioneer John W. Tukey, an abbreviation of binary digit, probably chosen for its identity with bit (n.1).

bit (v.)

past tense of bite.

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Definitions of bit from WordNet

bit (n.)
a small piece or quantity of something;
a bit of paper
a bit of lint
I gave him a bit of my mind
Synonyms: spot
bit (n.)
a small fragment of something broken off from the whole;
a bit of rock caught him in the eye
Synonyms: chip / flake / fleck / scrap
bit (n.)
an indefinitely short time;
in just a bit
Synonyms: moment / mo / minute / second
bit (n.)
an instance of some kind;
he had a bit of good luck
Synonyms: piece
bit (n.)
piece of metal held in horse's mouth by reins and used to control the horse while riding;
the horse was not accustomed to a bit
bit (n.)
a unit of measurement of information (from binary + digit); the amount of information in a system having two equiprobable states;
there are 8 bits in a byte
bit (n.)
a small amount of solid food; a mouthful;
all they had left was a bit of bread
Synonyms: morsel / bite
bit (n.)
a small fragment;
Synonyms: snatch
bit (n.)
a short performance that is part of a longer program;
Synonyms: act / routine / number / turn
bit (n.)
the part of a key that enters a lock and lifts the tumblers;
bit (n.)
the cutting part of a drill; usually pointed and threaded and is replaceable in a brace or bitstock or drill press;
he looked around for the right size bit
From wordnet.princeton.edu