"insect, beetle," 1620s (earliest reference is to bedbugs), of unknown origin, probably (but not certainly) from or influenced by Middle English bugge "something frightening, scarecrow" (late 14c.), a meaning obsolete since the "insect" sense arose except in bugbear (1570s) and bugaboo (q.v.).
Probably connected with Scottish bogill "goblin, bugbear," or obsolete Welsh bwg "ghost, goblin" (compare Welsh bwgwl "threat," earlier "fear," Middle Irish bocanách "supernatural being"). Some speculate that these words are from a root meaning "goat" (see buck (n.1)) and represent originally a goat-like spectre. Compare also bogey (n.1) and Puck. Middle English Dictionary compares Low German bögge, böggel-mann "goblin." Perhaps influenced in meaning by Old English -budda used in compounds for "beetle" (compare Low German budde "louse, grub," Middle Low German buddech "thick, swollen").
In the United States bug is not confined, as in England, to the domestic pest, but is applied to all insects of the Coleoptera order, which includes what in this country are generally called beetles. [Farmer & Henley, "Dictionary of Slang and Colloquial English," 1912 abridged edition]
Meaning "defect in a machine" (1889) may have been coined c. 1878 by Thomas Edison (perhaps with the notion of an insect getting into the works). Meaning "person obsessed by an idea" (as in firebug "arsonist") is from 1841, perhaps from notion of persistence. Sense of "microbe, germ" is from 1919. Bugs "crazy" is from c. 1900. Bug juice as a slang name for drink is from 1869, originally "bad whiskey." The 1811 slang dictionary has bug-hunter "an upholsterer." Bug-word "word or words meant to irritate and vex" is from 1560s.