The story
The adjective imaginary in this context was first used (as French imaginaire) by René Descartes in 1673, La Geometrie, referring to imaginary numbers in the broad sense, as non-real roots of polynomials. Descartes' usage was derogatory, but the concept later gained acceptance through the work of Leonhard Euler and Carl Friedrich Gauss in the 18th century.
Etymology from Wiktionary, CC BY-SA 4.0.