Its use has changed dramatically over the decades:
[O]ne of its first written appearances came in 1883, in the American magazine, which referred to "the social ‘dude’ who affects English dress and the English drawl". The teenage American republic was already a growing power, with the economy booming and the conquest of the West well under way. But Americans in cities often aped the dress and ways of Europe, especially Britain. Hence dude as a dismissive term: a dandy, someone so insecure in his Americanness that he felt the need to act British.