Ethanol is the principal psychoactive constituent in alcoholic beverages.

Alcoholic beverages vary considerably in their ethanol content and in the foodstuffs from which they are produced. Most alcoholic beverages can be broadly classified as fermented beverages, beverages made by the action of yeast on sugary foodstuffs, or as distilled beverages, beverages whose preparation involves concentrating the ethanol in fermented beverages by distillation.

The ethanol content of a beverage is usually measured in terms of the volume fraction of ethanol in the beverage, expressed either as a percentage or in alcoholic proof units. Fermented beverages can be broadly classified by the foodstuff from which they are fermented. Beers are made from cereal grains or other starchy materials, wines and ciders from fruit juices, and meads from honey. Cultures around the world have made fermented beverages from numerous other foodstuffs, and local and national names for various fermented beverages abound. Distilled beverages are made by distilling fermented beverages.

Broad categories of distilled beverages include whiskeys, distilled from fermented cereal grains; brandies, distilled from fermented fruit juices, and rum, distilled from fermented molasses or sugarcane juice. Vodka and similar neutral grain spirits can be distilled from any fermented material (grain or potatoes are most common); these spirits are so thoroughly distilled that no tastes from the particular starting material remain. Numerous other spirits and liqueurs are prepared by infusing flavors from fruits, herbs, and spices into distilled spirits. A traditional example is gin, which is created by infusing juniper berries into a neutral grain alcohol.

In a few beverages, ethanol is concentrated by means other than distillation. Applejack is traditionally made by freeze distillation, by which water is frozen out of fermented apple cider, leaving a more ethanol-rich liquid behind. Eisbier (more commonly, eisbock) is also freeze-distilled, with beer as the base beverage.

Fortified wines are prepared by adding brandy or some other distilled spirit to partially-fermented wine. This kills the yeast and conserves some of the sugar in grape juice; such beverages are not only more ethanol-rich, but are often sweeter than other wines. Alcoholic beverages are sometimes used in cooking, not only for their inherent flavors, but also because the alcohol dissolves hydrophobic flavor compounds which water cannot. Just as industrial ethanol is used as feedstock for the production of industrial acetic acid, alcoholic beverages are made into culinary/household vinegar.