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Old English þusend, from Proto-Germanic *thusundi (cf. Old Frisian thusend, Dutch duizend, Old High German dusunt, German tausend, Old Norse þusund, Gothic þusundi).
Related to words in Balto-Slavic (cf. Lithuanian tukstantis, Old Church Slavonic tysashta, Polish tysiąc, Czech tisic), and probably ultimately a compound with indefinite meaning "several hundred" or "a great multitude" (with first element perhaps related to Sanskrit tawas "strong, force").
Used to translate Greek khilias, Latin mille, hence the refinement into the precise modern meaning. There was no general Indo-European word for "thousand." Slang shortening thou first recorded 1867. Thousand island dressing (1916) is presumably named for the region of New York on the St. Lawrence River.