In the 1920s, the fashionable hemline for women rose enough to show the legs, and sheer hosiery that covered the legs was only available as stockings. They were first made of silk or rayon (known as "artificial silk"), and after 1940 with nylon. In the 1940s and 1950s, film and theatre productions were having stockings sewn to the briefs of actresses and dancers. 

In 1953, Allen Gant Sr. of Glen Raven Knitting Mills developed a commercial equivalent named "Panti-Legs", but didn't bring it to market until 1959. He was inspired by his wife’s lament about the either squeezing into a girdle or slipping on a garter belt to keep the stockings up.

During this time another American, Ernest G. Rice, invented his own design similar to what is used today, and in 1956 submitted a patent titled "Combination Stockingsand Panty". 

Allen Gant Sr. had at least one satisfied customer, but the panty-stocking combo did not grab most women’s attentions at first. Though the convenience of not having to wear a girdle or garter belt was a plus, what helped pantyhose take hold was the rise of theminiskirt in the mid-1960s. During the 1960s, improved manufacturing made them cheaper, spandex (or elastane) made them more comfortable, and the miniskirt made them a fashion necessity. In 1970, US sales of pantyhose exceeded stockings for the first time, and has remained this way ever since. 

For the fashion-conscious woman looking to wear a skirt shorter than stockings are long, pantyhose were the perfect fit. When iconic models such as Jean Shrimpton and Twiggy donned their mini skirts, demand forpantyhose exploded and women flocked to the stores for pairs of their own. 

The popularity of pantyhose grew into a wardrobe staple throughout the 1970s and 1980s. It wasn't until 1995 that a steady decline began, leveling off in 2006 with US sales less than half of what they had been. This decline has been attributed to bare-legged fashion and changes in workplace dress code.

While sales of traditional pantyhose styles remain low, alternative styles have seen growth. Fishnets, patterns and colours, opaque tights, low-rise, footless shapewear, and mantyhose have all seen increased popularity during this time. 

from: http://my.opera.com/Zaphira/blog/2010/01/12/the-history-of-the-pantyhose