As the name implies, it's called this because it is usually placed at the head. Normally people are buried with a stone at the head only, but sometimes they are buried with both a headstone and footstone to mark the length of the grave.  Comes from the name Head (meaning head of grave) and Stone(long lasting material used to encribe names and dates).  Headstones usually face the east (facing the rising sun).  Although modern cemeteries may have graves facing other directions, east-facing tombstones are still found in many Christian and Jewish cemeteries.