Like a lot of American place names it is an 
American Indian name turned into English.
Endonyms
The native name is written 
Massachuseuck (
Muhsachuweeseeak) /məhs at͡ʃəw iːs iː ak/—singular 
Massachusee (
Muhsachuweesee).[
citation needed] It translates as "at the great hill,"
[2] referring to the 
Great Blue Hill, located in 
Ponkapoag.
Exonyms
English settlers adopted the term 
Massachusett for the name for the people, language, and ultimately as the name of their colony which became the American state of 
Massachusetts. 
John Smith first published the term 
Massachusett in 1616.
[2] Narragansett people called the tribe Massachêuck.
[2]
Yes.
English is functionally terrible in the written language being a poor match to the sounds of words. Ideally we'd have one letter per sound and it would be unambiguous how to pronounce something from how it is written. But English is an amalgamation of a bunch of other languages with different incompatible rules sort of jumbled together and overlapping and multiple letters doing more than double duty on sounds. It really bugs me that stuff from other languages get thrown into English with yet more different weird rules and so the spelling without context of those obscure specific rules gives a completely false impression of the spoken word.
This makes English a very subtle written language, meaning not "Sub tull" but "Suddle" where everything is weird.