1650s, "inability to read and write," from illiterate + abstract noun suffix -cy. Earlier in this sense was illiterature (1590s).
Entries linking to illiteracy
illiterate adj.
early 15c., "uneducated, unable to read and write" (originally meaning Latin), from Latin illiteratus "unlearned, unlettered, ignorant; without culture, inelegant," from assimilated form of in- "not, opposite of" (see in- (1)) + literatus "educated," literally "furnished with letters" (see literate). Old English used unstæfwis as a loan-translation of Latin illiteratus. As a noun meaning "illiterate person" from 1620s. Hence, illiterati (1788, Horace Walpole).
-cy
abstract noun suffix of quality or rank, from Latin -cia, -tia, from Greek -kia, -tia, from abstract ending -ia (see -ia) + stem ending -c- or -t-. The native correspondents are -ship, -hood.
literacy n.
"ability to read and write," 1883, from literate + abstract noun suffix -cy. Illiteracy, however, dates back to 17c.