The Collaborative International Dictionary of English v.0.48:

Preoccupy \Pre*oc"cu*py\, v. t. [imp. & p. p. Preoccupied
   (-p[imac]d); p. pr. & vb. n. Preoccupying.] [Cf. F.
   pr['e]occuper. See Preoccupate, Occupy.]
   1. To take possession of before another; as, to preoccupy a
      country not before held.
      [1913 Webster]

   2. To prepossess; to engage, occupy, or engross the attention
      of, beforehand; hence, to prejudice.
      [1913 Webster]

            I Think it more respectful to the reader to leave
            something to reflections than to preoccupy his
            judgment.                             --Arbuthnot.
      [1913 Webster]

WordNet (r) 3.0 (2006):

preoccupied
    adj 1: deeply absorbed in thought; "as distant and bemused as a
           professor listening to the prattling of his freshman
           class"; "lost in thought"; "a preoccupied frown" [syn:
           bemused, deep in thought(p), lost(p),
           preoccupied]
    2: having or showing excessive or compulsive concern with
       something; "became more and more haunted by the stupid
       riddle"; "was absolutely obsessed with the girl"; "got no
       help from his wife who was preoccupied with the children";
       "he was taken up in worry for the old woman" [syn: haunted,
       obsessed, preoccupied, taken up(p)]

Moby Thesaurus II by Grady Ward, 1.0:

151 Moby Thesaurus words for "preoccupied":
   absent, absentminded, absorbed, absorbed in, abstracted, assiduous,
   bemused, besotted, blind, buried in, buried in thought,
   castle-building, caught up in, constant, contemplating,
   contemplative, continuing, daydreaming, daydreamy, deaf, deep,
   devoted, devoted to, diligent, dogged, dreaming, dreamy, drowsing,
   ecstatic, elsewhere, enduring, engaged, engaged in thought,
   engrossed, engrossed in, engrossed in thought, faithful, faraway,
   fixated, forgetful, gripped, half-awake, held, hung-up, immersed,
   immersed in, immersed in thought, immutable, in a reverie,
   in the clouds, inalterable, indefatigable, indomitable,
   industrious, infatuated, insensible, insistent, intent, intent on,
   introspective, invincible, involved, lasting, lost, lost in,
   lost in thought, loyal, meditating, meditative, monomaniac,
   monomaniacal, monopolized, mooning, moonraking, museful, musing,
   napping, never-tiring, nodding, oblivious, obsessed, obstinate,
   occupied, patient, patient as Job, pensive, permanent, perseverant,
   persevering, persistent, persisting, pertinacious, pipe-dreaming,
   plodding, plugging, possessed, prepossessed, rapt, relentless,
   resolute, sedulous, single-minded, sleepless, slogging,
   somewhere else, stable, stargazing, steadfast, steady, stubborn,
   studious, studying, submerged in, swept up, taken up,
   taken up with, tenacious, tireless, totally absorbed, transported,
   unabating, unconquerable, unconscious, undaunted, undiscouraged,
   undrooping, unfailing, unfaltering, unflagging, unflinching,
   unintermitting, uninterrupted, unnodding, unrelaxing, unrelenting,
   unremitting, unsleeping, unswerving, untiring, unwavering,
   unwearied, unwearying, unwinking, utterly attentive, weariless,
   woolgathering, wrapped, wrapped in, wrapped in thought, wrapped up,
   wrapped up in