The term is God-Moding, not God-Modding. God-Moding is a term derived from the original first person shooter video game in the year 1993. In the game, developers had a secret code that allowed them to perform various tricks like refilling ammunition, replenishing health and the like. One of these abilities was to be totally invincible, and have perpetual ammunition. This was called the "God Mode".

On a related note, the term "pwn" or "pwned" is rarely understood either. When someone is totally and utterly thrashed, in a video game, sports game or whatever they are said to have been pwned. This term is derived from the era of MUSHes MUDs and MOOs, the original MMORPG that were played entirely through text. Objects in these games could be linked to your character, like a warrior holding a sword. Anything created that belonged to a player, particularly props designed by the player him or herself, was "player owned" or in the short form, "p-Owned" and finally "pwned". Thus, to pwn someone to beat them so badly that you own their arses :)