The name was chosen during one of several brainstorming sessions held by the Java software team. The Java software team were aiming to come up with a name that evoked the essence of the technology -- liveliness, animation, speed, interactivity, and more. "Java" was chosen from among many, many suggestions. The name is not an acronym, but rather a reminder of that hot, aromatic stuff that many programmers like to drink lots of.

Source: Frequently Asked Questions About Java