The term "T-bill" is a modern financial acronym, a product of 20th-century bureaucratic and market shorthand. It is formed by taking the initial letter "T" from "Treasury", referring to the U.S. Department of the Treasury, and appending the word "bill", which in financial contexts denotes a short-dated debt instrument. The word "bill" itself evolved from a document bearing a seal (Latin 'bulla') to signify an official promissory note. Thus, a "T-bill" literally translates to a "Treasury debt note," efficiently encapsulating its identity as a short-term security issued by the national treasury department.

This is a clipped compound formed from the initial letter of "Treasury" and the full word "bill". "Treasury" originates from Old French 'tresorie', from Latin 'thesaurus', meaning "treasury, storehouse". "Bill" originates from Medieval Latin 'bulla', meaning "seal, sealed document".