The story
Derives from its action which is reminiscent of the iris of the eye.
Etymology from Wiktionary, CC BY-SA 4.0.
iris diaphragm
Today it means: An adjustable diaphragm by which the diameter of an approximately circular opening may be controlled, as for regulating the aperture of a lens; it consists of a number of movable thin curved plates fastened at regular intervals around the inside of a ring, the positions of which are simultaneously adjusted by a single knob on the outside of the lens. It is used in cameras and microscopes. Full definition →