The Collaborative International Dictionary of English v.0.48:

Spy \Spy\ (sp[imac]), v. t. [imp. & p. p. Spied (sp[imac]d);
   p. pr. & vb. n. Spying.] [OE. spien, espien, OF. espier, F.
   ['e]pier, OHG. speh[=o]n, G. sp[aum]hen; akin to L. specere
   to see, Skr. spa[,c]. [root] 169. Cf. Espy, v. t.,
   Aspect, Auspice, Circumspect, Conspicuous, Despise,
   Frontispiece, Inspect, Prospect, Respite, Scope,
   Specimen, Spectacle, Specter, Speculate, Spice,
   Spite, Suspicion.]
   1. To gain sight of; to discover at a distance, or in a state
      of concealment; to espy; to see.
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            One, in reading, skipped over all sentences where he
            spied a note of admiration.           --Swift.
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   2. To discover by close search or examination.
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            Look about with your eyes; spy what things are to be
            reformed in the church of England.    --Latimer.
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   3. To explore; to view, inspect, and examine secretly, as a
      country; -- usually with out.
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            Moses sent to spy out Jaazer, and they took the
            villages thereof.                     --Num. xxi.
                                                  32.
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The Collaborative International Dictionary of English v.0.48:

Spy \Spy\, v. i.
   To search narrowly; to scrutinize.
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         It is my nature's plague
         To spy into abuses.                      --Shak.
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The Collaborative International Dictionary of English v.0.48:

Spy \Spy\, n.; pl. Spies (sp[imac]z). [See Spy, v., and cf.
   Espy, n.]
   1. One who keeps a constant watch of the conduct of others.
      "These wretched spies of wit." --Dryden.
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   2. (Mil.) A person sent secretly into an enemy's camp,
      territory, or fortifications, to inspect his works,
      ascertain his strength, movements, or designs, and to
      communicate such intelligence to the proper officer.
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   Spy money, money paid to a spy; the reward for private or
      secret intelligence regarding the enemy.

   Spy Wednesday (Eccl.), the Wednesday immediately preceding
      the festival of Easter; -- so called in allusion to the
      betrayal of Christ by Judas Iscariot.
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   Syn: See Emissary, and Scout.
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WordNet (r) 3.0 (2006):

spy
    n 1: (military) a secret agent hired by a state to obtain
         information about its enemies or by a business to obtain
         industrial secrets from competitors [syn: spy,
         undercover agent]
    2: a secret watcher; someone who secretly watches other people;
       "my spies tell me that you had a good time last night"
    v 1: catch sight of [syn: descry, spot, espy, spy]
    2: watch, observe, or inquire secretly [syn: spy, stag,
       snoop, sleuth]
    3: catch sight of; to perceive with the eyes; "he caught sight
       of the king's men coming over the ridge" [syn: spy,
       sight]
    4: secretly collect sensitive or classified information; engage
       in espionage; "spy for the Russians"