'archvillain' is a compound formed from the prefix 'arch-' and the noun 'villain'. 'arch-' derives from Greek 'arkhos' meaning 'chief, principal' (via Old French/Latin use in English compounds), and 'villain' comes from Old French 'vilain', from Late Latin 'villanus' meaning 'farmhand, villager'.

'arch-' has been used in English compounds since Late Middle English to indicate 'principal' (e.g. 'archbishop'), and 'villain' shifted in meaning from 'farmhand' (Late Latin 'villanus') through Old French 'vilain' to Middle English 'villain' meaning a rude, base, or wicked person. The compound 'archvillain' attested in modern English as the term for a chief villain.

Originally 'villain' referred to a person of the villa or a farmhand; over time it acquired the sense of a rude or base person and eventually 'wicked person'. 'Archvillain' thus came to mean 'the chief wicked person' and is used now to denote the principal antagonist or most blameworthy individual.