c. 1500, "trade, commerce," from French trafique (15c.), from Italian traffico (14c.), from trafficare "carry on trade," of uncertain origin, perhaps from a Vulgar Latin *transfricare "to rub across," from Latin trans "across" (see trans-) + fricare "to rub" (see friction), with the original sense of the Italian verb being "touch repeatedly, handle."
Or the second element may be an unexplained alteration of Latin facere "to make, do." Klein suggests ultimate derivation of the Italian word from Arabic tafriq "distribution." Meaning "people and vehicles coming and going" first recorded 1825. Traffic jam is by 1908, ousting earlier traffic block (1895). Traffic circle is from 1938.