The Collaborative International Dictionary of English v.0.48:

Dally \Dal"ly\ (d[a^]l"l[y^]), v. i. [imp. & p. p. Dallied
   (d[a^]l"l[i^]d); p. pr. & vb. n. Dallying.] [OE. dalien,
   dailien; cf. Icel. pylja to talk, G. dallen, dalen, dahlen,
   to trifle, talk nonsense, OSw. tule a droll or funny man; or
   AS. dol foolish, E. dull.]
   1. To waste time in effeminate or voluptuous pleasures, or in
      idleness; to fool away time; to delay unnecessarily; to
      tarry; to trifle.
      [1913 Webster]

            We have trifled too long already; it is madness to
            dally any longer.                     --Calamy.
      [1913 Webster]

            We have put off God, and dallied with his grace.
                                                  --Barrow.
      [1913 Webster]

   2. To interchange caresses, especially with one of the
      opposite sex; to use fondling; to wanton; to sport.
      [1913 Webster]

            Not dallying with a brace of courtesans. --Shak.
      [1913 Webster]

            Our aerie . . . dallies with the wind. --Shak.
      [1913 Webster]

Moby Thesaurus II by Grady Ward, 1.0:

61 Moby Thesaurus words for "dallying":
   Micawberish, backward, coquetry, dabbling, dalliance, dawdling,
   delaying, dilatoriness, dilatory, dillydallying, dolce far niente,
   dragging, easygoing, fiddling, flirtation, fooling, fooling around,
   foot-dragging, goofing off, idling, jerking off, kidding around,
   lackadaisical, lag, laggard, lagging, lax, lazing, lazy, lingering,
   loafing, loitering, lolling, lollygagging, lounging,
   messing around, monkeying, monkeying around, mopery, piddling,
   playing, playing around, pottering, procrastinating,
   procrastination, procrastinative, procrastinatory, puttering,
   remiss, shilly-shallying, shuffling, slack, slow, sluggish,
   smattering, tarriance, tarrying, tinkering, toying, trifling,
   waiting