Etymology
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Words related to lunatic

luna (n.)
late 14c. "the moon," especially as personified in a Roman goddess answering to Greek Selene; also an alchemical name for "silver;" from Latin luna "moon, goddess of the moon," from PIE *leuksna- (source also of Old Church Slavonic luna "moon," Old Prussian lauxnos "stars," Middle Irish luan "light, moon"), suffixed form of root *leuk- "light, brightness." The luna moth (1841, American English) so called for the crescent-shaped eye-spots on its wings.
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insane (adj.)
1550s, of persons, "mentally damaged," from Latin insanus "mad, insane, of unsound mind; outrageous, excessive, extravagant," from in- "not" (see in- (1)) + sanus "well, healthy, sane" (see sane). In reference to actions, "irrational, evidencing madness," from 1842 in English. The noun meaning "insane person" is attested from 1786. For the notion of insanity as sickness, compare lunatic; and Italian pazzo "insane," originally a euphemism, from Latin patiens "suffering." German verrückt, literally past participle of verrücken "to displace," "applied to the brain as to a clock that is 'out of order' " [Buck].
*leuk- 

Proto-Indo-European root meaning "light, brightness."

It forms all or part of: allumette; elucidate; illumination; illustration; lea; leukemia; leuko-; light (n.) "brightness, radiant energy;" lightning; limn; link (n.2) "torch of pitch, tow, etc.;" lucent; lucid; Lucifer; luciferase; luciferous; lucifugous; lucubrate; lucubration; luculent; lumen; Luminal; luminary; luminate; luminescence; luminous; luna; lunacy; lunar; Lunarian; lunate; lunation; lunatic; lune; lunette; luni-; luster; lustrum; lux; pellucid; sublunary; translucent.

It is the hypothetical source of/evidence for its existence is provided by: Sanskrit rocate "shines;" Armenian lois "light," lusin "moon;" Greek leukos "bright, shining, white;" Latin lucere "to shine," lux "light," lucidus "clear;" Old Church Slavonic luci "light;" Lithuanian laukas "pale;" Welsh llug "gleam, glimmer;" Old Irish loche "lightning," luchair "brightness;" Hittite lukezi "is bright;" Old English leht, leoht "light, daylight; spiritual illumination," German Licht, Gothic liuhaþ "light."

loony (adj.)

also loonie, looney, luny, "crazy; silly and eccentric," 1853, American English, short for lunatic, but also influenced by loon (n.2) and perhaps loon (n.1), the bird being noted for its wild cry and method of escaping from danger. As a noun by 1884, from the adjective.

Slang loony bin "insane asylum" is by 1909. Looney left in reference to holders of political views felt to be left-wing in the extreme is from 1977. Looney Tunes, Warner Bros. studios' animated cartoon series, dates from 1930.

lunacy (n.)
1540s, "condition of being a lunatic," formed irregularly in English from lunatic (q.v.) + -cy. Originally in reference to intermittent periods of insanity, such as were believed to be triggered by the moon's cycle. The Old English equivalent was monaðseocnes "month-sickness." In later legal use, any unsoundness of mind sufficient to render one incapable of civil transactions or management of one's affairs. Weakened figurative sense "act of madness or folly" is from 1580s.