"Descendants of the alien species that gave the name of the Sith Order and humans, Purebloods have a high percentage of Force sensitivity and sharp bone ridges."

 

This is taken from http://www.swtor.com/gamemanual/getting-started/species-selection.

 

I am unsure of what it means, does it mean that the Sith Purebloods were responsible for naming humans?

No it means that some humans crossbred with the original Sith species native to Korriban and their descendants are what are now know as "Sith Purebloods."