The Collaborative International Dictionary of English v.0.48:

Furlough \Fur"lough\, n. [Prob. fr. D. verlof, fr. a prefix akin
   to E. for + the root of E. lief, and akin to Dan. forlov, Sw.
   f["o]rlof, G. verlaub permission. See Life, a.] (Mil.)
   Leave of absence; especially, leave given to an officer or
   soldier to be absent from service for a certain time; also,
   the document granting leave of absence.
   [1913 Webster]

The Collaborative International Dictionary of English v.0.48:

Furlough \Fur"lough\, v. t. [imp. & p. p. Furloughed; p. pr. &
   vb. n. Furloughing.] (Mil.)
   To furnish with a furlough; to grant leave of absence to, as
   to an officer or soldier. Furmonty

WordNet (r) 3.0 (2006):

furlough
    n 1: a temporary leave of absence from military duty
    v 1: dismiss, usually for economic reasons; "She was laid off
         together with hundreds of other workers when the company
         downsized" [syn: furlough, lay off]
    2: grant a leave to; "The prisoner was furloughed for the
       weekend to visit her children"