in Old English a common prefix with nouns, adjectives, adverbs, and verbs, "out, outward, outer; forth, away," from out (adv.). The use was even more common in Middle English, and also with the senses "outer, outside, on the outside, from without, external, externally; apart; greatly, extremely; completely, thoroughly, to completion." Other senses of out that extended into the use as a prefix include "beyond the surface or limits; to the utmost degree; to an explicit resolution."
In composition out has either its ordinary adverbial sense, as in outcast, outcome, outlook, etc., or a prepositional force, as in outdoors, or forms transitive verbs denoting a going beyond or surpassing of the object of the verb, in doing the act expressed by the word to which it is prefixed, as in outrun, outshine, outvenom, etc. In the last use especially out may be used with almost any noun or verb. [Century Dictionary]
late Old English smeart "painful, severe, stinging; causing a sharp pain," related to smeortan (see smart (v.)). Meaning "executed with force and vigor" is from c. 1300. Meaning "quick, active, clever" is attested from c. 1300, from the notion of "cutting" wit, words, etc., or else "keen in bargaining." Meaning "trim in attire" first attested 1718, "ascending from the kitchen to the drawing-room c. 1880" [Weekley]. For sense evolution, compare sharp (adj.).
In reference to devices, the sense of "behaving as though guided by intelligence" (as in smart bomb) first attested 1972. Smarts "good sense, intelligence," is first recorded 1968 (Middle English had ingeny "intellectual capacity, cleverness" (early 15c.)). Smart cookie is from 1948.