What does 'Terminal' derive from?
The first definition, as it relates to computers. See Computer terminal on Wikipedia.


  A computer terminal is an electronic or electromechanical hardware device that is used for entering data into, and displaying or printing data from, a computer or a computing system. The teletype was an example of an early day hardcopy terminal, and predated the use of a computer screen by decades.


As @8None1 elaborates in the comments below, the MacOS "Terminal" is more accurately a "terminal emulator" as described in the same Wikipedia article, since a terminal is a piece of hardware while the "Terminal" app is software that emulates that hardware.