The Collaborative International Dictionary of English v.0.48:

Grisly \Gris"ly\, a. [OE, grisly, grislich, AS. grislic,
   gryslic, fr. gr?san to shudder; cf. OD. grijselick horrible,
   OHG. grisenl?ch, and also AS. gre?san to frighten, and E.
   gruesome.]
   Frightful; horrible; dreadful; harsh; as, grisly locks; a
   grisly specter. "Grisly to behold." --Chaucer.
   [1913 Webster]

         A man of grisly and stern gravity.       --Robynson
                                                  (More's
                                                  Utopia).
   [1913 Webster]

   Grisly bear. (Zool.) See under Grizzly.
      [1913 Webster]

WordNet (r) 3.0 (2006):

grisly
    adj 1: shockingly repellent; inspiring horror; "ghastly wounds";
           "the grim aftermath of the bombing"; "the grim task of
           burying the victims"; "a grisly murder"; "gruesome
           evidence of human sacrifice"; "macabre tales of war and
           plague in the Middle ages"; "macabre tortures conceived
           by madmen" [syn: ghastly, grim, grisly, gruesome,
           macabre, sick]

Moby Thesaurus II by Grady Ward, 1.0:

67 Moby Thesaurus words for "grisly":
   abhorrent, abominable, appalling, astounding, awe-inspiring,
   awesome, awful, blue, cadaverous, corpselike, deadly, deathlike,
   deathly, deathly pale, dire, direful, disgusting, dread, dreaded,
   dreadful, eerie, fell, forbidding, formidable, foul, frightful,
   ghastly, ghostlike, ghostly, ghoulish, gory, grim, gruesome,
   haggard, hideous, horrendous, horrible, horrid, horrific,
   horrifying, livid, loathsome, lurid, macabre, morbid, mortuary,
   nasty, nauseating, offensive, pale, redoubtable, repellent,
   repelling, repugnant, repulsive, revolting, schrecklich, shocking,
   sickening, terrible, terrific, terrifying, tremendous, uncanny,
   unearthly, wan, weird