While living in Italy for 5 years I have never heard of Alfredo sauce. However, it is one of 5 most common pasta sauces you can find in Italo-American restaurants alongside with bolognese, pesto, aglio, and pomodoro. Also this time wikipedia has an answer.

It appears that the dish "fettuccine alfredo" became popular among American tourists after Mary Pickford and Douglas Fairbanks tried it in Alfredo di Lelio's restaurant in Rome in 1927. In it's essence, "fetuccine alfredo" is di Lelio's version of "pasta al burro" which could be found in southern Italy.