The story
Coined by American journalist Jeff Howe in 2006, see quotations. From crowd + sourcing, by analogy with outsourcing.
Etymology from Wiktionary, CC BY-SA 4.0.
crowdsourcing
Today it means: The delegation of a task to a large diffuse group in order to introduce new or more developed skill sets and improve efficiency. There is usually no substantial monetary compensation involved. Full definition →