This phrase made the rounds during my school days applied in particular to a fellow student who is now a well known Bollywood actress and supermodel. One of the girls discovered it in an old obscure book filled with such deliciously old fashioned terms and anybody with a slightly supercilious air would get tagged with it.
Hoity-toity means someone who is pompous,haughty or pretentiously self important. On a milder note it also means given to frivolity, silliness or riotousness. This being the original meaning of the term which later metamorphosed into what it is now.
The frivolousness/riotousness meaning was first recorded in Sir Roger L'Estrange's 1668 translation of The visions of Don Francisco de Quevedo Villegas:
"The Widows I observ'd ... Chanting and Jigging to every Tune they heard, and all upon the Hoyty-Toyty, like mad Wenches of Fifteen."
The later meaning isn't seen until around mid to late 18th century and is recorded in O'Keefe's Fontainebleau in 1784:
"My mother ... was a fine lady, all upon the hoity-toities, and so, good for nothing."
Hoity toity is a reduplicated phrase where one word carries an existing meaning and the other is present for emphasis. In this case the earlier meaning of the term came from the word hoit. This is a now defunct verb meaning to indulge in riotous, noisy mirth. That in turn was formed from hoyden - a boorish clown or rude boisterous girl. The change from one meaning to the other seems to be due to the pronunciation of hoity as heighty and the subsequent allusion to highness or haughtiness.
There are intermediate definitions given for this term in two 18th century dictionaries
A new dictionary of the terms ancient and modern of the canting crew says:
"Hightetity, a Ramp or Rude Girl."
A classical of the vulgar tongue by Francis Grose says:
"Heighty toity, a hoydon, or romping girl."