Excerpt from an interview with Ken Thompson (9-6-89):
Every time we made a directory, by
convention we put it in another
directory called directory –
directory, which was dd. Its name was
dd and that all the users directories
and in fact most other directories,
users maintain their own directory
systems, had pointers back to dd, and
dd got shortened into ‘dot-dot,’ and
dd was for directory-directory.