"absolute ruler," 1560s, in Italian form dispotto (1580s as despot); from Medieval Latin despota, from Greek despotēs "master of a household, lord, absolute ruler," from PIE *dems-pota- "house-master," from the genitive of the root *dem- "house, household" + second element from PIE root *poti- "powerful; lord." The compound might be prehistoric; compare Sanskrit dampati- "lord."
Originally in English in reference to Byzantine rulers or Christian rulers in Ottoman provinces and often neutral. But it had been faintly pejorative in Greek (ruler of an un-free people), and it was used in various languages for Roman emperors. It became fully negative with the French Revolution, where it was applied to Louis XVI. In English the sense of "one who governs according to his own will, under a recognized right but uncontrolled by constitutional restrictions or the wishes of his subjects" is by 1610s; by c. 1800 it was used generally for "a tyrant, an oppressor."
The Greek female equivalent was despoina "lady, queen, mistress," source of the fem. proper name Despina.