Simon Hoggart, in his diary published in the Guardian , tells us that, from an etymological point of view, this term is absolutely nonsensical. If we break it up, we see that it is made of:
Homo – it could be the prefix of Greek origin meaning "same", as in homophone (words that sound the same but don’t mean the same, like night and knight) or the Latin prefix meaning "human" (homo and homo being… homophones).
Phobia – fear, hatred of.
Hence, the word homophobia could be interpreted as either disliking/fearing the same kind of person as yourself or the whole of the human race, instead of homosexuals. The correct term could be homophiliaphobia (fear/hatred of those who like people from the same sex as theirs), but there is little chance of that one catching on.
I tried to find out when homophobia was coined to see if it would help me understand its origin, without luck. However, the American Heritage® Dictionary gives us the following etymology:
homo(sexual) + phobia.
It becomes clear that, as I suspected, homo is neither a Latin nor a Greek prefix in this instance. It is merely the shortened version of homosexual. Add to that phobia, and you get the hatred of homosexuals. It’s quite an unusual way to coin a new word and I wonder if many are born that way?
(Words, not homosexuals).