"low island of sand or coral," 1707, from Spanish cayo; see key (n.2).
Entries linking to cay
key n.2
"low island," 1690s, from Spanish cayo "shoal, reef," from Taino (Arawakan) cayo "small island;" spelling influenced by Middle English key "wharf" (c. 1300; mid-13c. in place names), from Old French kai "sand bank" (see quay).