Tennis' establishment as the modern sport can be dated to two separate roots. Between 1859 and 1865, Major Harry Gem, a solicitor, and his friend Augurio Perera, a Spanish merchant, who both lived in Birmingham, England developed a game that combined elements of both the game of rackets and the Spanish ball game pelota, and played it on Perera's croquet lawn in Edgbaston.In 1872 both men moved to Leamington Spa, and with two doctors from the Warneford Hospital, played pelota on the lawn behind the Manor House Hotel (now residential apartments). Perera joined with Dr. Frederick Haynes and Dr. A. Wellesley Tomkins to found the first lawn tennis club in the world, and played the game on nearby lawns.In 1874 they formed the Leamington Tennis Club, setting out the original rules of the game. The Courier of 23 July1884 recorded one of the first tennis tournaments, held in the grounds of Shrubland Hall (demolished 1948). 

In December 1873, Major Walter Clopton Wingfield devised a similar game for the amusement of his guests at a garden party on his estate at Nantclwyd, Wales. He based the game on the older sport of indoor tennis or real tennis.

Seeing the commercial potential of the game, Wingfield patented it in 1874, but never succeeded in enforcing his patent. Tennis spread rapidly among the leisured classes in Britain and the United States. It was first played in the U.S. at the home of Mary Ewing Outerbridge on Staten Island, New York in 1874.

In 1881 the desire to play tennis competitively led to the establishment of tennis clubs. The first championships at Wimbledon, in London were played in 1877. On May 21, 1881, the United States National Lawn Tennis Association (now the United States Tennis Association) was formed to standardize the rules and organize competitions. The comprehensive I.L.T.F. rules promulgated in 1924 have remained remarkably stable in the ensuing eighty years, the one major change being the addition of the tie-breaker system designed by James Van Alen. The U.S. National Men's Singles Championship, now the U.S. Open, was first held in 1881 at Newport, Rhode Island. The U.S. National Women's Singles Championships were first held in 1887.  The Davis Cup, an annual competition between national teams, dates to 1900. 

Tennis was for many years predominantly a sport of the English-speaking world, dominated by the United States and Britain. It was also popular in France, where the French Open dates to 1891. Thus Wimbledon, the U.S. Open, the Australian Open and the French Open (dating to 1905) became and have remained the most prestigious events in tennis.  Together these four events are called the Grand Slam (a term borrowed from bridge). 

In 1926, promoter C.C. Pyle established the first professional tennis tour with a group of American and French tennis players playing exhibition matches to paying audiences.The most notable of these early professionals were the American Vinnie Richards and the Frenchwoman Suzanne Lenglen. Once a player turned pro he or she could not compete in the major (amateur) tournaments. In 1968, commercial pressures led to the abandonment of this distinction, inaugurating the open era, in which all players could compete in all tournaments, and top players were able to make their living from tennis. 

With the beginning of the open era, the establishment of an international professional tennis circuit, and revenues from the sale of television rights, tennis has spread all over the world and has lost its upper-class English-speaking image.

In America, the game has seen a seismic shift from a sport that the "country-club set" played to one that is an activity for anyone. This is perhaps best embodied in the fact that in the 1970s, when popularity of the game was at a peak, the USTA decided to move the U.S. Open from the posh West Side Tennis Club to a public park (the USTA National Tennis Center, Flushing Meadows Park) that is accessible to anyone with the "greens fees".About the same time, the ruling body's name was also changed from United States Lawn Tennis Association to United States Tennis Association. 

In 1954 James Van Alen founded the International Tennis Hall of Fame, a non-profit museum in Newport, Rhode Island. The building contains a large collection of tennis memorabilia as well as a hall of fame honoring prominent members and tennis players from all over the world. Each year, a grass-court tournament is hosted on the grounds that are home to the Tennis Hall of Fame, as well as an induction ceremony honoring new Hall of Fame members.

Naming

Traced back as far as the ancient Greek game of sphairistike, tennis was introduced by Major Walter Wingfield, who borrowed the name of this Greek game in order to name this recreational sport that he patented in February 23, 1874. It followed several conversions in name before finally decided by Wingfield, upon the suggestion of Arthur Balfour, as lawn tennis.

Wingfield borrowed both the name and much of the French vocabulary of royal tennis and applied them to his new game:

• Tennis comes from the French tenez, the imperative form of the verb tenir, to hold: This was a cry used by the player serving in royal tennis, meaning "I am about to serve!" (rather like the cry "Fore!" in golf).
• Racquet comes from raquette, which derives from the Arabic rakhat, meaning the palm of the hand. 
• Deuce comes from à deux le jeu, meaning "to both is the game" (that is, the two players have equal scores).
• Love may come from l'œuf, the egg, a reference to the egg-shaped zero symbol; however, since "un œuf" is more commonly used, the etymology remains in question.
• The convention of numbering scores "15", "30" and "40" comes from quinze, trente and quarante, which to French ears makes a euphonious sequence, or from the quarters of a clock (15, 30, 45) with 45 simplified to 40.

Reference: Wikipedia - Online Encyclopaedia

 More information can be found on the LTA website.