The term has been used for well over two centuries. The earliest known use was by French American writer St. John de Crevecoeur in rural New York in 1778. There are several theories as to its etymology:

* It may be so named because this was the traditional period where North American First Nations/Native American peoples would harvest their fall crops.

* In The Americans, The Colonial Experience, Daniel J. Boorstin speculates that the term originated from raids on European colonies by Indian war parties; these raids usually ended in autumn, hence the extension to summer-like weather was an "Indian" summer. Indeed, two of the three other known uses of the term "Indian summer" in the 18th century are from accounts kept by two Army officers leading retaliation expeditions against Indians for raids on settlers in Ohio and Indiana (1790), and Pennsylvania (1794).[1]

* It could be so named because the phenomenon was more common in what were then North American Indian territories, as opposed to the Eastern seaboard.

* It may be of Asian Indian, rather than North American Indian, origin. H. E. Ware, an English writer, noted that ships at that time traversing the Indian Ocean loaded up their cargo the most during the "Indian Summer", or fair weather season. Several ships actually had an "I.S." on their hull at the load level thought safe during the Indian Summer.

http://en.wikipedia.org/wiki/Indian_summer