from online entymology dictionary
http://www.etymonline.com/index.php?term=alcoholalcohol
1543, "fine powder produced by sublimination," from M.L. alcohol "powdered ore of antimony," from Ar. al-kuhul "kohl," the fine metallic powder used to darken the eyelids, from kahala "to stain, paint." The al- is the Arabic definite article, "the." "Powdered cosmetic" was the earliest sense in Eng.; definition broadened 1672 to "any subliminated substance, the pure spirit of anything." Modern sense of "intoxicating ingredient in strong liquor" is first recorded 1753, short for alcohol of wine, which was extended to "the intoxicating element in fermented liquors." In organic chemistry, the word was extended 1850 to the class of compounds of the same type as this. Alcoholism "disease of alcohol addiction" is from 1852; alcoholic "one who is addicted to drinking in excess" is from 1891. Alcoholics Anonymous founded 1935 in Akron, Ohio, U.S. Alky is first recorded 1844 as a slang shortening of "alcoholic liquor;" 1960 in the sense of "a drunkard."
From Wikipedia:
Alcohol
From Wikipedia, the free encyclopedia.
In general usage, alcohol (from Arabic al-khwl ÇáßÍæá, or al-ghawl ÇáÛæá) refers almost always to ethanol, also known as grain alcohol, and often to any beverage that contains ethanol (see alcoholic beverage)......
Etymology
The word "alcohol" almost certainly comes from the Arabic language (the "al-" prefix being the Arabic definite article); however, the precise origin is unclear. It was introduced into Europe, together with the art of distillation and the substance itself, around the 12th century by various European authors who translated and popularized the discoveries of Islamic alchemists.
A popular theory, found in many dictionaries, is that it comes from ÇáßÍá = ALKHL = al-kuhul, originally the name of very finely powdered antimony sulfide Sb2S3 used as an antiseptic and eyeliner. The powder is prepared by sublimation of the natural mineral stibnite in a closed vessel. According to this theory, the meaning of alkuhul would have been first extended to distilled substances in general, and then narrowed to ethanol. This conjectured etymology has been circulating in England since 1672 at least (OED).
However, this derivation is suspicious since the current Arabic name for alcohol, ÇáßÍæá = ALKHWL = al???, does not derive from al-kuhul. The Qur'an in verse 37:47 uses the word ÇáÛæá = ALGhWL = al-ghawl — properly meaning "spirit" ("spiritual being") or "demon" — with the sense "the thing that gives the wine its headiness". The word al-ghawl also originated the English word "ghoul", and the name of the star Algol. This derivation would, of course, be consistent with the use of "spirit" or "spirit of wine" as synonymous of "alcohol" in most Western languages. (Incidentally, the etymology "alcohol" = "the devil" was used in the 1930s by the U.S. Temperance Movement for propaganda purposes.)
According to the second theory, the popular etymology and the spelling "alcohol" would not be due to generalization of the meaning of ALKHL, but rather to Western alchemists and authors confusing the two words ALKHL and ALGhWL, which have indeed been transliterated in many different and overlapping ways.