The name refers to its replacement of lath and plaster wall building, in which plaster was spread over small wooden formers while still wet. This method was time consuming and labor intensive (although skilled plasterers could do the job with great rapidity), whereas an entire house can be drywalled in a day or two by two experienced "drywallers", and drywall is easy enough to use that it can be installed by many amateur home carpenters.
In veneer plastering, a specially prepared type of drywall board (blueboard) is covered with several thin coats of plaster.