Old English lam "clay, mud, clayey or muddy earth," from Proto-Germanic *laimaz (source also of Old Saxon lemo, Dutch leem, German Lehm "loam"), from PIE root *(s)lei- "slimy" (source also of Latin limus "mud;" see slime (n.)).
In early use also the stuff from which God made man in His image. As the technical name for a type of highly fertile clayey soil, it is attested from 1660s. As a verb from c. 1600. Related: Loamed; loaming. Loamshire as a name for an imaginary typical rural English county is from "Adam Bede" (1859).