mid-14c., "place where one lives or dwells," also "general course of actions or habits, manner of conducting oneself in the world," both senses now obsolete; from Old French conversacion "behavior, life, way of life, monastic life," and directly from Latin conversationem (nominative conversatio) "frequent use, frequent abode in a place, intercourse, conversation," noun of action from past-participle stem of conversari "to live, dwell, live with, keep company with," passive voice of conversare "to turn about, turn about with," from assimilated form of com "with, together" (see con-) + versare, frequentative of vertere "to turn" (from PIE root *wer- (2) "to turn, bend").
Sense of "informal interchange of thoughts and sentiments by spoken words" is from 1570s. Used as a synonym for "sexual intercourse" from at least late 14c., hence criminal conversation, a legal term for adultery from late 18c. Conversation-piece is from 1712 as "painting representing a group of figures arranged as if in conversation;" 1784 as "subject for conversation, something to talk about."