This was for a few reasons.
1. If you passed a stranger on the road, you walked on the left to ensure that your protective sword arm was between yourself and him.
2. In those days, we needed our right hands free to hold a sword, whilst the other hand held the reins of the horse.
3. One mounts a horse from its left and it was sensible not to be doing this whilst out 'in the traffic'.
4. When carts passed each other the drivers needed to be sure that they actually missed each other so they passed "driver to driver". I.e. they drove on the left.
In 1773 an increase in horse traffic forced the UK Government to introduce the General Highways Act of 1773 which contained a keep left recommendation. This became a law as part of the Highways Bill in 1835.
So why do other countries drive on the right?
In Continental Europe however, the "Keep Left" practice was changed due to Napoleon.
The reason it changed under Napoleon was because he was left handed his armies had to march on the right so he could keep his sword arm between him and any opponent.
From then on, any part of the world which was at some time part of the British Empire was thus left hand and any part colonised by the French was right hand.
The drive-on-the-right policy was adopted by the USA, which was anxious to cast off all remaining links with its British colonial past
Once America drove on the right, left-side driving was ultimately doomed. If you wanted a good reliable vehicle, you bought American, for a period they only manufactured right-hand-drive cars.
From then on many countries changed out of necessity.
Today, the EC would like Britain to fall into line with the rest of Europe, but this is no longer possible. It would cost billions of pounds to change everything round.
The last European country to convert to driving on the right was Sweden in 1967. While everyone was getting used to the new system, they paid more attention and took more care, resulting in a reduction of the number of road accident casualties.
From September 2009 Samoa now drives on the left instead of the right.
The main reason for this is that they want to use right-hand-drive cars, for instance from Japan and New Zealand, which both drive on the left.