It is from Old English werewulf, the first element of which is usually identified with Old English wer, a man.
Its cognates are Dutch weerwolf, German Werwolf, Danish, Swedish and Norwegian varulv, and French garou. Now obsolete, garou is from Old-Northern French forms such as garvalf, from an unattested Old-Norse form varulf-r. The French word in usage is the pleonastic loup-garou, literally wolf-man-wolf (the plural leus warous is attested in the late-12th century) — loup was prefixed to garou because the sense of the final -ou had been lost.
(The French name garou corresponds to English werewolf because in words of Germanic origin, when initial, the labio-velar approximant /w/ has regularly become the velar /g/; for instance, le pays de Galles corresponds to Wales, gaufre to wafer, and gardien to warden (English guardian is a later borrowing from French); this velar is spelt gu before the vowels e and i, as in guerre, corresponding to war, and Guillaume, to William.)
The English werewolf is first attested in a spiritual symbolic sense, in the Anglo-Saxon Ecclesiastical Ordinances of Cnut (died 1035), Danish king of England from 1017 to 1035:
Ꝥonne moton ꝥa hyrdas beon swyðe wacore ⁊ geornlice clypigende, ꝥe wið ꝥone ꝥeodsceaðan folce sceolon scyldan: ꝥæt syndan bisceopas ⁊ mæssepreostas, ꝥe godcunde heorda bewarian ⁊ bewerian sceolon mid wislican laran, ꝥæt se wodfreca werewulf to swyðe ne slite, ne to fela ne abite of godcundre heorde.
translation from A Lycanthropy Reader: Werewolves in Western Culture (New York, 1986), edited by Charlotte F. Otten:
Therefore must the shepherds be very watchful and diligently crying out, who have to shield the people against the spoiler, such are bishops and mass-priests, who are to preserve and defend their spiritual flocks with wise instructions, that the madly audacious werewolf do not too widely devastate, nor bite too many of the spiritual flock.
Here, werewolf does not refer to a human being who has been changed, or is capable of changing, into a wolf, but is symbolic; it is substituted for the scriptural wolf used:
– in Christ’s Sermon on the Mount (Gospel of Matthew, 7:15):
“Watch out for false prophets. They come to you in sheep’s clothing, but inwardly they are ferocious wolves.” (New International Version)
– in Paul’s farewell to the Ephesian elders (Acts of the Apostles, 20:28-29):
28 “Keep watch over yourselves and all the flock of which the Holy Spirit has made you overseers. Be shepherds of the church of God, which he bought with his own blood. 29 I know that after I leave, savage wolves will come in among you and will not spare the flock.” (New International Version)
The substitution of werewolf for the scriptural wolf in the Anglo-Saxon Ecclesiastical Ordinances acknowledges Satan’s capacity to spiritually metamorphose the human beings whom he enlists as allies and servants.
The word werewolf continued to be used in this spiritual symbolic sense in the Middle-English poem Piers the Plowman’s Crede, written between 1393 and 1401; the narrator, a poor man in quest for spiritual truth, wants to learn the Apostles’ Creed – the simple pre-Nicene statement of faith; as he does not know where to find someone to instruct him, he consults friars – a Franciscan, a Dominican, an Austin and a Carmelite successively – but is dismayed that the friars instead denounce the rival fraternal orders or try to dun him for money; in despair, he encounters a ploughman, who asks him “why syghest thou so harde?” [= “why do you sigh so hard?”], to which the narrator replies:
“I can nought [= I don’t know] my Crede, I kare well harde.
For I can fynden no man that fully byleveth
To techen [= to teach] me the heyghe [= high] weie, and therfore I wepe.
For I have fonded [= I have gone to] the freres of the foure orders,
For there I wende have wist, but now my wit lakketh;
[= From them I thought I would learn, but now I am at my wits’ end;]
And all my hope was on hem, and myn herte also.
But thei ben fully feithles, and the fend sueth [= follow the fiend].”
At this point, the ploughman condemns the friars as hypocrites in a paraphrase of the Gospel of Matthew, 7:15:
“A, brother,” quath he tho, “beware of tho foles [= fools]!
For Crist seyde Himselfe ‘of swich I you warne,’
And false profetes in the feith He fulliche hem calde [= called],
‘In vestimentis ovium, but onlie withinne
[= In sheep’s clothing, except within]
Thei ben wilde wer-wolves that wiln the folk robben [= wish to rob the folk].’”
Werewolf (circa 1512), by Lucas Cranach the Elder (circa 1472-1553)