Originally, lands of any particular parish were often given, or enfeoffed, to an individual who had served the king well. This gave meaning in medieval times to the expression 'The king's faithful servant'. In return for being granted the lands, the beneficiary owed service to the grantor, often that service was 'knight service'. Initially, this was 'service' for 40 days in an army when called upon by the king, where the grantee was expected to arrive at the appointed place with all the accoutrement necessary to fight in a war, such as a horse and armour. Hence such an individual was said to hold [named lands] 'by service of one knight's fee'.
Often the original grant of lands would be re-granted in turn by the initial grantee (of the king) to another individual, and potentially again by the second grantee to a third or more grantees. Moreover, the landed estate could be broken into parts before further grant or inheritance. Hence the frequent occurrence of the related parts of a knight's fee, such as a quarter or even smaller, e.g. one eighth or one tenth of a knight's fee. A knight's fee held direct of the king was described as held 'in capite' or 'in chief'. An individual who held many knight's fees was often known as a Baron. Thus an individual might be said to 'hold one [quarter or other part of a] knight's fee of [the king, or other named individual]'. And we have 'Eustace de Watford held one knight's fee in chief'.'
The area of land associated with a knight's fee, and what happened when the lord of a knight's fee did not serve in an army when called, are discussed in other posts.