Telnet was developed and standardized in the early 1980’s (the main RFC’s were published in 1983), though some sources claim that Telnet can be traced back to the 1960’s. It's actually the oldest protocol in the TCP/IP suite.
Telnet was the first application protocol demonstrated on the young ARPAnet, in 1969. The first RFC specifically defining Telnet was RFC 97, "First Cut at a Proposed Telnet Protocol", published in February 1971 (and not available online).
Development of Telnet continued throughout the 1970s, with quite a number of different RFCs devoted to revisions of the protocol and discussions of issues related to it. It took many years to refine Telnet and resolve all the difficulties that were associated with its development.