If by album art you mean like for music CD's (or LP's and EP's back in the day), the history and design conventions are pretty broad. Some producers hire graphics artists or designers for their album covers, some artists make their own or have artistic friends make them. I'm not quite sure of the history in terms of when it began or what the first was, but I can point out a couple interesting design conventions from an art history standpoint!
Franz Ferdinand. This indie Rock band has nearly all of their album designs based off of Soviet Constructivism:
Coldplay: more mix in design, but Viva la Vida features Liberty Leading the People
The Beatles: Their famous Abbey Road cover was thought up by McCartney and professionally done. The photograph is not just a cover anymore, but part of British modern photography.
