In 18th century written works, the first letters of certain words often appear capitalized. An example, as written by Benjamin Franklin, reads like, "I should think it no Trouble to hear their Complaints if I could be of the least Use in accommodating their Differences; but since that was not likely, I could only wish as I had a Regard for both, that they would go on to the End of their Term as quietly as possible, since that would be most to the Credit of both." Why was this style used? Did it have any particular significance or was it just an 18th century curiosity, like s's that look like f's? And how did it fall out of practice?
If you reread the passage carefully, you'll notice that all the capitalized words are nouns. In fact, all the nouns (except for pronouns) are capitalized. This style of capitalization was popular in the late 17th and early 18th centuries, but eventually fell into disuse. The German language, on the other hand, is written this way even today.
Source: The Cambridge Encyclopedia of the English Language
Edit: Just noticed that you also asked where it came from and why it went away. I don't have a detailed answer for you, I'm afraid -- It was probably imitated from German, but I have no idea why it fell out of favor in English.