c.1300 "small ax" (mid-12c. in surnames), from Old French hachete, diminutive of hache "ax, battle-axe, pickaxe," possibly from Frankish *happja or some other Germanic source, from Proto-Germanic *hæbijo (cf. Old High German happa "sickle, scythe"), from PIE root *kop- "to beat, strike" (cf. Greek kopis "knife;" Lithuanian kaplys "hatchet," kapoti "cut small;" Old Church Slavonic skopiti "castrate").
In Middle English, hatch itself was used in a sense "battle-axe." In 14c., hang up (one's) hatchet meant "stop what one is doing." Phrase bury the hatchet (1794) is from a supposed Native American peacemaking custom. Hatchet-man was originally California slang for "hired Chinese assassin" (1880), later extended figuratively to journalists who attacked the reputation of a public figure (1944).