The idea was brought to England by William the Conqueror when the value of mounted (and therefore expensive) knights became clear. When William parceled out England to his nobles, who then parceled out their states to their vassals, the smallest unit was kept large enough to furnish the taxes/funds for one knight's fees.
This same system of dividing and sub-dividing the land, called "subinfeudation," was established in Ireland when it was conquered by Henry II. If land was subdivided "too far" then each smaller parcel had to provide the appropriate fraction of a knight's fee to go toward furnishing a knight.
There were other variations over time. In England, only the king was due knight-service, whereas in France other lords could invoke it from those to whom they granted land (giving them opportunities to create their own armies). In the 1100s terms of service were extended, but could also be avoided by scutage, paying a tax to the lord. Scutage made it easier to gather an army, because one could simply collect the money and then hire mercenaries. By 1300, mercenaries were becoming the chief manner of maintaining a military force.
The term for this was routier, and I'll tell you more about them tomorrow.
