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Ted Nelson Coins the Terms Hypertext, Hypermedia, and Hyperlink (1965)

In 1965 self-styled "systems humanist" Ted Nelson (Theodor Holm Nelson) published "Complex Information Processing: A File Structure for the Complex, the Changing, and the Indeterminate," ACM '65 Proceedings of the 1965 20th national conference, 84-100In this paper Nelson coined the terms hypertext and hypermedia to refer to features of a computerized information system. He used the word "link" to refer the logical connections that came to be associated with the word "hyperlink."  

Nelson is also credited with inventing the word hyperlink, though its published origin is less specific:

"The term "hyperlink" was coined in 1965 (or possibly 1964) by Ted Nelson and his assistant Calvin Curtin at the start of Project Xanadu. Nelson had been inspired by "As We May Think", a popular essay by Vannevar Bush. In the essay, Bush described a microfilm-based machine (the Memex) in which one could link any two pages of information into a "trail" of related information, and then scroll back and forth among pages in a trail as if they were on a single microfilm reel. The closest contemporary analogy would be to build a list of bookmarks to topically related Web pages and then allow the user to scroll forward and backward through the list.

In a series of books and articles published from 1964 through 1980, Nelson transposed Bush's concept of automated cross-referencing into the computer context, made it applicable to specific text strings rather than whole pages, generalized it from a local desk-sized machine to a theoretical worldwide computer network, and advocated the creation of such a network. Meanwhile, working independently, a team led by Douglas Engelbart (with Jeff Rulifson as chief programmer) was the first to implement the hyperlink concept for scrolling within a single document (1966), and soon after for connecting between paragraphs within separate documents (1968)" (Wikipedia article on Hyperlink, accessed 08-29-2010). 

Wardrip-Fruin and Montfort, The New Media Reader (2003) 133-45.