1859, thieves' slang, "counterfeit, sham, bad, spurious," of unknown origin. Century Dictionary suggests it is a dialectal variant of snithe, itself a dialectal adjective meaning "sharp, cutting," used of the wind, from the Middle English verb snithen "to cut," from Old English snithan, which is cognate with German schneiden.
In earliest use it seems to have been most commonly applied to counterfeit coin. Farmer & Henley (1903) have it as "bad, wretched, contemptible, or (army) dirty." Of persons, "characterized by low cunning and sharp practice," by 1874 (Hotten). Sense of "sneering" is attested by 1928, perhaps via the earlier noun sense of "hypocrisy, malicious gossip" (1902). Related: Snidely.
The tradition that a first-rate man is less a first-rate man if, encountering a snide detraction of himself that has no respect for the facts, he makes a critical riposte, strikes me as being just about as silly as anything I have run across during many years spent in this silly world. I speak, of course and obviously enough, not of snide criticism written by essentially snide men, but of the species of snide criticism that is every once in a while written by men who should know better. [George Jean Nathan, "Clinical Notes," The American Mercury, June 1928]