IT Chapter Two reveals the true origins of Pennywise as an ancient being that landed in Derry millions of years ago - but also hints at an intriguing extra layer to the clown's origin story. We know that the "Eater of Worlds" emerges every 27 years to feast on the unsuspecting citizens of Derry, and has done so for centuries. However, Beverly's visit to her old apartment, now occupied by "Mrs. Kersh," suggests that there may be a reason why IT's favorite form is that of a clown.
According to the rich mythology of Stephen King's book, which is sketched out in IT Chapter Two, IT originally emerged from a vast void called the Macroverse, which contains the main universe as well as others (which were vomited up by a vast god-turtle called Maturin). IT crash-landed on Earth eons ago, then lay dormant until some tasty humans arrived, ready for slaughter. In King's novel, the first humans IT preyed on were the townsfolk that founded Derry in 1715, but IT Chapter Two changes this to acknowledge the fact that Native Americans lived on the land before settlers arrived, and were therefore the first to be attacked by IT (and also discovered a ritual for defeating IT).
IT's modus operandi is to take the form of whatever it thinks will terrify its victims the most, so that it can feast on their fear before consuming their flesh. IT takes on various forms, like the leper that Eddie sees and the horrible flute woman that Stanley sees, but its favorite form by far is that of a clown. King chose a clown because, as he explained, "clowns scare children more than anything else in the world." IT Chapter Two, however, suggests that there may be more to it than that.
Pennywise's "Origin" In IT Chapter 2
In IT Chapter Two, the adult members of the Losers' Club are tasked with returning to places of significance to unlock lost memories and recover tokens to be used in the Ritual of Chüd. For Beverly, this means returning to the apartment where she was raised by her abusive father. Upon arriving at the apartment, she discovers that it's now occupied by an old woman called Mrs. Kersh, who insists on inviting her in for tea and cookies.
While Beverly looks at Mrs. Kersh's weird family photos, the old woman tells her a story about how her "fadder" came to America and earned a living for himself, without asking for any handouts. She then reveals that her "fadder" was a circus clown, as Beverly discovers an old photo of a man (Bill Skarsgård, without his Pennywise makeup) standing next to a wagon with "Pennywise the Dancing Clown" emblazoned on the side. Too late, Beverly realizes that Mrs. Kersh is actually IT in disguise, and the old woman takes on a nude and monstrous form, chasing Beverly around the apartment.
Beverly looks back upon reaching the front door and sees the man from the photo, painting his face in white makeup, then scratching his nails down his face to create Pennywise's characteristic makeup with his blood. The flashback implies a different origin for Pennywise: that he was a circus clown in the early 1900s who became corrupted and had his form taken over by IT. This would explain why IT almost always takes the form of that particular clown - but is this origin story real, or is it just another one of IT's lies?
Pennywise's Origin Is A Lie... Or Is It?
There's a strong case to be made that Pennywise's supposed backstory is entirely a lie, specifically concocted to target Beverly's worst fears. Beverly was abused by her father, so for her one of the most frightening things IT can do is to take on the form of a father figure. We know for sure that IT was preying on Derry before the time period in which Mrs. Kersh's father hypothetically came to America, and the first movie even showed Pennywise the Clown, specifically, depicted in a very old woodcut. We also know that nothing Beverly saw in her old apartment was real; she emerges from the building to discover that it's actually an abandoned ruin. So, none of the photos that she saw were actually there, and both Mrs. Kersh and her "fadder" were just IT taking on different forms.
All that being said, it's possible that there is some truth to the story that Beverly is told. IT does use human agents to carry out its horrible deeds - most notably Henry Bowers, who was corrupted by IT in the first movie. He killed his father and then tried to kill the Losers' Club to prevent them from reaching ITs lair, and Henry returns in IT Chapter Two to try and kill them all over again. IT takes on monstrous forms like that of the leper, a giant Jack Bunyan, and an adorable Pomerian that turns into a nightmare hound, but it also takes on the forms of real people like Beverly, Beverly's father, and Eddie's mother.
It's possible that there really was a human version of Pennywise the Dancing Clown who lived in Derry and became possessed by the other-worldly entity, carrying out violence in the same way that Henry Bowers did. IT may have been searching for a form most effective for frightening children, and noticed that Pennywise's look was effective for both drawing in victims and then scaring them when they got close.
Pennywise's Real Origin
IT Chapter Two is unambiguous about the clown-monster's real origins, with both Mike and Bill experiencing visions of IT crashing down to Earth and the Native Americans' attempt to banish it. The film's origin story more or less matches up with what is described in the book, though details like the giant turtle that vomited up the universe are only nodded to via a recurring motif of turtles, rather than laid out explicitly. When the Losers go to battle with IT for the last time, they discover the ancient crater where IT originally landed, deep below the sewers of Derry, and IT takes on a spider-like form like it does in the book.
There are also pieces of ITs origin that didn't make it into the final cut of either movie. Two earlier drafts of the script for IT were written by Cary Fukunaga and his writing partner Chase Palmer, but were ultimately scrapped. In these versions, there were three historical events that were specifically detailed: IT compelling the KKK to destroy a black speakeasy; a lumberjack slaughtering card players in a saloon while IT plays the piano; and a woman being offered a choice to either allow her whole family to be killed, or sacrifice her young daughter to IT. She chooses the second option, and this choice effectively becomes Derry's original sin - creating a pattern of IT preying on children and the town turning a blind eye to those deaths.
A version of this last scene was actually filmed for IT, but didn't make it into the final cut of the movie. In this deleted scene, set in the 1600s, Pennywise has not settled into his clown form yet but is instead (according to the script) "naked, lithe, flesh pale and translucent, a half-formed imitation of a human." He threatens a woman called Abigail, telling her he will consume her entire family and their souls. Abigail makes an offering of her baby, and then stares distractedly into the Deadlights as Pennywise consumes it. "I'm not the clown. I look more like myself," Bill Skarsgård explained when describing the scene. "It’s very disturbing, and sort of a backstory for what IT is, or where Pennywise came from."
All of this suggests that IT didn't originally take on the appearance of a clown, and when IT first encountered humans it had trouble deciding which form to take. That in turn supports the idea of Pennywise copying his name and appearance from a real Pennywise the Dancing Clown who existed at some point in Derry's history, meaning that what Beverly saw in her old apartment may not have been a complete fabrication. It's something that the film ultimately leaves up to audience interpretation - which makes it all the more intriguing.