The term Persian is an English derivation of Latin Persiānus, the adjectival form of Persia, itself deriving from Greek Persís (Περσίς),[12] a Hellenized form of Old Persian Pārsa (𐎱𐎠𐎼𐎿),[13] which means "Persia" (a region in southwestern Iran corresponding to modern-day Fars province).

The majority of scholars believes Dari refers to the Persian word dar or darbār "court" (دربار) as it was the formal language of the Sasanian dynasty.

[19] However, it is not descended from the literary form of Middle Persian (known as pārsīk, commonly called Pahlavi), which was spoken by the people of Fars and used in Zoroastrian religious writings.

Instead, it is descended from the dialect spoken by the court of the Sasanian capital Ctesiphon and the northeastern Iranian region of Khorasan, known as Dari.

[22] Abbas of Merv is mentioned as being the earliest minstrel to chant verse in the newer Persian tongue and after him the poems of Hanzala Badghisi were among the most famous between the Persian-speakers of the time.

[25] The language spread geographically from the 11th century on and was the medium through which among others, Central Asian Turks became familiar with Islam and urban culture.

New Persian was widely used as a trans-regional lingua franca, a task for which it was particularly suitable due to its relatively simple morphological structure and this situation persisted until at least the 19th century.

[26] "Classical Persian" loosely refers to the standardized language of medieval Persia used in literature and poetry.

Persian was the only non-European language known and used by Marco Polo at the Court of Kublai Khan and in his journeys through China.

In addition, under the Qajar rule numerous Russian, French, and English terms entered the Persian language, especially vocabulary related to technology.

It was established by the initiative of Reza Shah Pahlavi, and mainly by Hekmat e Shirazi and Mohammad Ali Foroughi, all prominent names in the nationalist movement of the time.

During the 1930s and 1940s, the academy led massive campaigns to replace the many Arabic, Russian, French, and Greek loanwords whose widespread use in Persian during the centuries preceding the foundation of the Pahlavi dynasty had created a literary language considerably different from the spoken Persian of the time.

Persian-speaking peoples of Iran, Afghanistan, and Tajikistan can understand one another with a relatively high degree of mutual intelligibility.