People often use this idiom when they decide to abruptly quit doing something that is considered bad for them, such as smoking.
Example: Tim has been drinking soda for years, but he wanted to cut down his sugar intake, so he quit soda 'cold turkey,' and started drinking more water instead.
KnowYourPhrase.com - The Meanings For Common Idioms
Note: The origins for many popular expressions are not known, like the one mentioned above. In cases like this, what I'll sometimes do is include the theories that are floating around that talk about how a phrase may have originated. If no theories are included on the idiom's page, then I'll at least try to include on the page the earliest known quote of the expression being used in print. These quotes can give an idea on how far back in history the expression goes.
The origin of this saying is not clear, however, there are a few explanations as to how
this phrase may have originated. One has to do with an older expression that goes
'talking turkey' or 'talking cold turkey,' which can mean one who speaks plainly, bluntly;
the person gets directly to the point, without any nonsense. This sort of direct approach
in speaking is similar to a person who quits something 'cold turkey,' they do so in a direct, no nonsense way. So it's possible then, that this phrase derives from this older 'talking turkey' expression.
Another explanation is that cold turkey is a dish that is quick to make, taking little time to prepare. This, apparently, then started to be used as a metaphor for when somebody quits doing something abruptly, without much preparation. This explanation seems odd, though, because there are plenty of other dishes that are also quick to make and that require little preparation, so why would cold turkey be the one that becomes an expression?
Anyways, the earliest this phrase appears in print, in connection to stopping a bad habit, is said to be from The Daily Colonist newspaper, 1921:
"Perhaps the most pitiful figures who have appeared before Dr. Carleton Simon are those who
voluntarily surrender themselves. When they go before him, they [drug addicts] are given what
is called the 'cold turkey' treatment."
* Due to recent health problems, he quit smoking cold turkey.