lye (n.) Look up lye at Dictionary.com
Old English læg, leag "lye, water impregnated with alkaline salt absorbed from the ashes of wood by leaching," from Proto-Germanic *laugo (source also of Middle Dutch loghe, Dutch loog, Old High German louga, German Lauge "lye"), from PIE root *leue- "to wash."

The substance formerly was used in place of soap, hence Old High German luhhen "to wash," Old Norse laug "hot bath, hot spring," Danish lørdag, Swedish lördag "Saturday," literally "washing-day," "the day appropriated by the Scandinavians to that exercise" [Century Dictionary]. Chamber-lye in early Modern English was the name for urine used as a detergent.