"condition or state (usually bad)," late 12c., "danger, harm, strife,"
from Anglo-French plit, pleit, Old French pleit, ploit "condition" (13c.), originally "way of folding,"
from Vulgar Latin plictum,
from Latin plicitum, neuter past participle of Latin *plicare "to fold, lay",
from PIE root *plek- "to plait".
Originally in neutral sense (as in modern French en bon plit "in good condition"),
sense of "harmful state" (and current spelling) probably is from convergence and confusion with plight (n.2) via notion of "entangling risk, pledge or promise with great risk to the pledger."
Please see the titled question.
How did a 'way of folding' (which looks limited to folding clothes) generalise to mean '"condition or state (usually bad)'?