The word testament in "New Testament" refers to a new covenant which Christians believe completes or fulfils the Mosaic covenant, or "old covenant", that Yahweh made with the people of Israel on Mount Sinai through Moses, as described in the books of the Old Testament. Christians traditionally view this new covenant as having been prophesied in Jeremiah 31–34.

The original Hebrew brit (בְּרִית) used to describe it, literally means 'alliance, covenant, pact'. The Greek term διαθήκη 'will (in the sense of a legal document)' was used to translate Hebrew brit in the Septuagint, for example in Κιβωτός της Διαθήκης for arón habrít (אֲרוֹן הַבְּרִית) 'Ark of the Covenant'. Latin testamentum 'will (legal document)' is a literal translation of the Greek word.

The choice of the term διαθήκη by the Jewish translators of the Septuagint in Alexandria in the 3rd and 2nd centuries BCE has been understood in Christian theology to imply a reinterpreted view of the Old Testament covenant with Israel as having the characteristics of a will that comes into effect after death — that is, the death of Jesus. This interprepation has attracted considerable attention from biblical scholars and theologians. In contrast to Jewish usage in which brit was the usual Hebrew word for pacts, alliances and covenants in general, such as an ordinary pact between two individuals, and to the covenant between God and Israel in particular, the Greek διαθήκη was virtually never used to refer to an alliance or covenant with one noted exception in a passage from Aristophanes; instead it refered to a will that comes into effect after a person's death. There is scholarly debate as to why the translators of the Septuagint chose διαθήκη to translate Hebrew brit, rather than another Greek word more commonly used to refer to an alliance or covenant.

The use of the phrase "New Testament" (Ἡ Καινὴ Διαθήκη) to designate a collection of first- and second-century Christian Greek scriptures can be traced back to Tertullian in his work Against Praxeas.

Jackson, Bernard S. (2013). "Why the Name New Testament?". Melilah: Manchester Journal of Jewish Studies. 9 (1): 50–100. doi:10.31826/mjj-2013-090104. http://static1.1.sqspcdn.com/static/f/784513/23609902/1380577434807/3.pdf?token=8ZveuYFof7uMu8UwoCMRepxQitY%3D

Norton, F.O., A Lexicographical and Historical Study of DIAΘHKH from the Earliest Times to the End of the Classical Period (Chicago: University of Chicago Press, 1908

Behm, J., “διαθήκη” (sections B-D), in Theological Dictionary of the New Testament, ed. G. Kittel and G. Friedrich, trans. G.W. Bromiley (Grand Rapids MI: Eerdmans, 1965), II.124–34.