Yeah, xkatz is right: kippah is Hebrew, yarmulke is Yiddish. Yarmulke tended to be used more in America during the first half of the 20th century, because the majority of Jews in the country at that time were Ashkenazim (from Germany or Eastern Europe), and many if not most spoke Yiddish, which was a thriving language then. But since WWII, the number of Yiddish speakers has dropped preciptiously, and at the same time, two important things happened: the less important of the two was that more Sefardim and Mizrachim immigrated to the US, and they came from cultures that didn't speak Yiddish; the more important was the founding of the State of Israel, whose national language is Hebrew. As Yiddish became spoken by fewer and fewer Jews, more and more Jews learned conversational Hebrew, and Hebrew really became the lingua franca of world Jewry in much more active way than it had been for some time.
So today, outside of a few Yiddish-speaking ultra-Orthodox communities, it is usually only older Jews, and relatively uneducated Jews who habitually use the word yarmulke instead of kippah, although there are always exceptions to those rules.
