Early model railroads (before WW I) were much bigger than now. The two scales of the oldest Märklin model RRs (one of the first manufacturers) were more or less:
Scale 1:22.5 ---> Track gauge was 64 millimeters (2.5") --> called gauge number II (two) .... and the smaller
Scale 1:32 ---> Track gauge was 45 mm (1.77") --> Gauge number I
Later, the scale was reduced further, and logically they chose the 'gauge number' 0 (zero, not the letter O!) So here goes:
Scale 1:43.5 ---> Track gauge is 32 mm (1.25") --> Gauge number 0
In German, this is still called 'Spur Null' = 'Gauge Zero', while in English it is more often called 'O gauge' (this time spoken as the letter O).
But hold on: Around WW II still smaller models became possible, and so in continental Europe H0 was born. 'H0' is the letter H followed by the number 0, meaning 'Half 0':
Scale 1:87 --> Track gauge is 16.5 mm (0.65") --> Gauge number H0
In England, the designation 00 ('double o') was chosen instead - with a different scale of 1:76.
Well, that's only (part of) the story of the Gauges H0 - 0 - I - II, but worldwide there are in fact more than 100 different track gauges and modeling scales for model RRs around! C-R-A-Z-Y!!!
Only two more:
S scale = 1:64 - S derived from 'Standard' --> the developers obviously dreamed of a new standard model RR size.
N scale = 1:160 - N is derived from 'Nine' or German 'Neun', since track gauge is 9 mm (0.354")
One thing I never understood is why the heck the developers of those model railroads chose such absurd and idiotic scales: 1:22.5, 1:43.5, 1:76, 1:87, 1:120 (TT scale)...
Why not 1:20 (or perhaps 1:24), 1:50, 1:75 or 1:100???

Probably we'll never know...
Ron