In the 1960s and 1970s most computers were decidedly not user friendly. They were usually large, expensive devices operated using batch-processing with punched cards or using interactive command-line operating systems accessed through teletypes or video display terminals. Specialised training was needed for these things to be usable.

In the early 1970s, Xerox began to experiment with a new graphical approach that culminated in its revolutionary Xerox Alto computer, which utilised a mouse and a bitmapped display. When the moment came to commercialise the Alto in the late 1970s, Xerox needed an interface that could ease office professionals without computer training into using computers.

David Canfield Smith at Xerox drew on his research work with graphical computing, where a computer could be programmed visually and, in the process, invented the computer icon. As an extension of that, Smith realized that he needed a metaphor that office workers already understood. He settled on visual, on-screen representations of real-world objects such as file cabinets, folders, and in-baskets that office workers used every day. These features were incorporated in the 1981 Xerox Star 8010 Information System.

The Star influenced successor computer systems, such as the Apple Lisa. Lisa borrowed the icon-based desktop approach from the Xerox Star, but Apple deserves credit for extending the idea dramatically.

More Info: en.wikipedia.org