It's the name given to a technique first associated with Terry Riley, Pauline Oliveros, and The San Francisco Tape Music Center. It involves two tape decks with the tape strung between them, and a signal feedback path from the second deck back to the first. The delay time is dependent on tape speed and the distance between the tape heads on the decks. This is often incorrectly refered to as a "tape loop", or "looping", but there is no tape loop involved, only a signal loop.
The first use of it I know of was by Terry Riley, in Music for The Gift (1963), but Pauline Oliveros recorded with it first on "I of IV" (1966), or maybe "Big Mother is Watching You" (1966). Terry Riley's first recorded use of it was his record A Rainbow in Curved Air with Poppy Nogood and the Phantom Band (1967). At any rate someone at the Tape Music Center, or maybe a French engineer Terry worked with on The Gift came up with it in the early 1960's.
Brian Eno knew about Riley's use of this technique, and in his collaboration with Robert Fripp on 1973's No Pussyfooting he introduced it to Fripp, who liked it enough to make it the core of Frippertronics. Eno eventually used it himself on Discreet Music (1975).
One good place to read about all things looping is the Looper's Delight website and mailing list. The section discussing Terry Riley and the Time Lag Accumulator is here.