1530s, "not subject to dispensation," from Medieval Latin *indispensabilis, from in- "not, opposite of" (see in- (1)) + dispensabilis, from Latin dispensare "disburse, administer, distribute (by weight)" (see dispense). Meaning "necessary" is from 1690s. From 17c. into 19c. often spelled indispensible, but modern dictionaries considered this improper.
As a noun, "indispensable thing," from 1794; c. 1800-1810, after French use, it was the name of a type of pocket bag worn by women. indispensables (1820) also was one of the many 1820s jocular euphemisms for "trousers" (see inexpressible). Related: Indispensably.
-ity
word-forming element making abstract nouns from adjectives and meaning "condition or quality of being ______," from Middle English -ite, from Old French -ete (Modern French -ité) and directly from Latin -itatem (nominative -itas), suffix denoting state or condition, composed of -i- (from the stem or else a connective) + the common abstract suffix -tas (see -ty (2)).
Roughly, the word in -ity usually means the quality of being what the adjective describes, or concretely an instance of the quality, or collectively all the instances; & the word in -ism means the disposition, or collectively all those who feel it. [Fowler]