The etymology of egregious is simple: e- from ex- meaning "out of," plus greg- or grex- meaning "herd." (The root greg- or grex- also developed into the English word gregarious). Egregious is applied to a number of things that stand out from the herd: it is used synonymously with extreme, extraordinary, and notorious. More rarely, it has been used as an etymologically-correct antonym to gregarious, meaning "asocial."

Back in the 16th century, egregious meant "remarkable for good quality; striking; distinguished." That sense disappeared, but not before egregious developed the (still current) sense "notorious; conspicuous for bad quality or taste."