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The English names for large numbers are coined from the Latin names for small numbers n by adding the ending -illion suggested by the name "million." Thus billion and trillion are coined from the Latin prefixes bi- (n = 2) and tri- (n = 3), respectively. In the American system for naming large numbers, the name coined from the Latin number n applies to the number 103n+3. In a system traditional in many European countries, the same name applies to the number 106n.
In particular, a billion is 109 = 1 000 000 000 in the American system and 1012 = 1 000 000 000 000 in the European system. For 109, Europeans say "thousand million" or "milliard."
Although we describe the two systems today as American or European, both systems are actually of French origin. The French physician and mathematician Nicolas Chuquet (1445-1488) apparently coined the words byllion and tryllion and used them to represent 1012 and 1018, respectively, thus establishing what we now think of as the "European" system. However, it was also French mathematicians of the 1600's who used billion and trillion for 109 and 1012, respectively. This usage became common in France and in America, while the original Chuquet nomenclature remained in use in Britain and Germany. The French decided in 1948 to revert to the Chuquet ("European") system, leaving the U.S. as the chief standard bearer for what then became clearly an American system.