1630s, "to yield, give way," from French céder or directly from Latin cedere "to yield, give place; to give up some right or property," originally "to go from, proceed, leave," from Proto-Italic *kesd-o- "to go away, avoid," from PIE root *ked- "to go, yield."
Original sense in English is now archaic; transitive sense "yield or formally surrender (something) to another" is from 1754. The sense evolution in Latin is via the notion of "to go away, withdraw, give ground." Related: Ceded; ceding.
Latin cedere, with prefixes attached, is the source of a great many English words: accede, concede, exceed, precede, proceed, recede, secede, etc.