'cedarwood' originates from Middle English, formed by combining 'cedar' and 'wood'. The element 'cedar' ultimately comes from Latin 'cedrus' and Greek 'kédros'.

The Greek word 'kédros' passed into Latin as 'cedrus', then into Old English/Middle English as 'ceder' or 'cedar'; compounding with Old English 'wudu' (wood) produced the modern English 'cedarwood'.

Initially it referred simply to the wood of the cedar tree; over time the term also came to denote the aromatic oil extracted from that wood ('cedarwood oil').