Meaning to delay, hesitate or hold back and dates in this figurative sense from the late 18th/early 19th century. Before this, to hang fire goes back to the early 16th century and the days of flintlock firearms where a hanging fire was the smouldering of the powder in the firing pan. This could happen when the powder was damp. In these circumstances, the rifleman or artilleryman would certainly hesitate and there would be a delay because he could not be sure if the weapon would discharge or not. See also flash in the pan.