So many and varied are the explanations available on the orgin of the zodiac signs that some theories are surely suspect. What is especially intriguing is how and why each sign of our zodiac came to carry the seeds of the interpretations we now apply.
Once one starts the enquiry its not long before feeling overwhelmed and submerged in theosophy, physics, the Bible, the Bhagavad Gita, mythology, morphology, Sumeria, Babylon, Greece, Egypt, and much more, until the eyes glaze (are yours glazed already?) Mention of India and China is omitted to simplify matters, they have their own stories.
What follows is my own, highly-distilled and simplified version - the way I understand it.
In order to trace the origin of the zodiac it's necessary to look for the origins of astrology itself, to discover whether the zodiac as we know it appeared intact from the beginning. "The beginning" of astrology is in question. Dates from 2000 to 9,000 years BC and even eras beyond that are mentioned in various sources, depending on exactly how one defines astrology.
Apparently astrology as we now understand it (or try to) did not exist in the beginning. Longer ago than anyone knows for sure, our ancestors in Sumeria, the area now known as Iraq, were recording the movements of the Sun, Moon and visible planets against the background of stars whose positions appeared not to vary.
Over a long period of time the cyclical and seasonal nature of those movements was understood and put to use counting time and in assessing orientation. This knowledge would have been valuable in agriculture and the production of food, for planning activities and journeys. Not surprisingly, early peoples attributed the planets and stars with god-like abilities.

It's amazing that such people, observing the sky with nothing but the naked eye, using pieces of stone and a carving tool, were able to make lasting records of their findings, a few examples still survive. It's tempting to wonder whether they had some kind of head start, essential knowledge handed down from a time of which modern man is no longer aware, a civilisation which may have perished leaving no trace but for some oral traditions retained by a few survivors. Or perhaps the ancient peoples did, after all, work things out for themselves by patient observation. We shall never know.
(Right" Sumerian astrology tablet, dating from around 2,300 BC)
By the time of Greek civilisation astronomical knowledge acquired by groups living further East had been passed along to Greece, probably via established trade routes over land and sea. The Greeks were great philosophers and seminal scientists.

When Greek philosophers put their minds to work on the basic knowledge, they garnished it, made it more palatable to their own people, and added to it by further observation and the use of geometry. Embellishment, using their own mythology - heroes, gods and goddesses must have helped make it accessible to those who sought to understand. It is probably around this stage that a zodiac, in a form familiar to us, appeared on the scene. The earliest rudimentary example of an actual astrological "reading" of a natal chart is said to date from around 410 BC.
Some historians say that the Greeks discovered the precession of the equinoxes, others contend that it was known at a much earlier stage. It's a thorny subject. Suffice to say that the discovery or re-discovery of precession resulted in two different zodiacs: the constellation-based zodiac, called "sidereal", and the solar-based tropical zodiac, most popular in modern times. The tropical zodiac was set to fix the vernal equinox at 0* Aries, rather than shifting over centuries along with the backdrop of stars. This had the effect of appointing the Sun as our main indicator, which of course, for life on Earth, it surely is. It also means that the constellations of stars which originally gave the signs their names no longer correspond with tropical zodiac signs. This can lead to confusion.

But how and why did each constellation of stars originally acquire its name? It is difficult to accept that stars in the constellations really do trace the outline of a lion, a scorpion, a virgin carrying a sheaf of wheat, a ram, a bull, etc. Yet the meanings we accept, the interpretations arising from them, are at the very core of astrology, and do seem to retain their accuracy, even after the tropical signs have moved on well past their sidereal position. This is the crux of the mystery.
Some modern sources surmise that the the basis of broad characteristics attributed to the 12 signs might be explained by a kind of electro-magnetic wave effect. This is not easy to fully understand or for me to explain succinctly.
The Greeks, who may appear to have been making wild guesses, attributed mythical figures to the visible planets (Mars, Venus, Jupiter etc.) and associated these (and related characteristics ?) with the 12 signs. But were they guessing, or is there a deeper explanation? Was there other knowledge available of which we remain unaware? How did they choose which to associate with what? The Egyptians are said to have had access to mysterious, now lost, knowledge. Was secret information from Egypt amalgamated with the Greeks' philosophies and scientific work?
(Above: Engraving illustrating a zodiac circle found on a celing of the Temple at Dendera, Egypt. Thought to date from 50 BC)
The elements (Earth, Fire, Air, Water), modes (Cardinal, Fixed, Mutable), and polarities (masculine/feminine, yin/yang) were associated with the zodiac signs at some stage, but exactly when this happened is not easily established. Again, there's evidence of a kind of interlinked wave effect going on.
Many texts were destroyed at various times in the distant past, by rulers or church leaders standing against astrology. Much crucial information must have perished. It's likely that the most important texts were the ones to go.

Astrology and the zodiac came to prominence in Europe, beyond Greece, in mediaeval times. What is now called "traditional astrology", based on the Greek version with many additions, modifications, bells and whistles, became the great-great grandfather of the basic astrology we use today. It should be mentioned that druids and the Celtic tribes are thought to have practiced a form of astrology in parts of Europe long before the more sophisticated Greek version arrived. They certainly used astronomy - close observation of the skies, Stonehenge is one of many pieces of evidence.
The zodiac, its signs and all they have come to represent, will not go away any time soon. They have survived longer than almost anything else in human experience, and will continue to survive. It's even possible that somewhere, hidden in all the detail, they contain a key to the greatest mystery of all - the mystery of mankind.
(Edited and illustrated version of my post of Jan. 2007)