The Collaborative International Dictionary of English v.0.48:

occupied \occupied\ adj.
   1. Engaged; in use; being used by a person and not free for
      use by someone else; as, the wc is occupied. Opposite of
      free, available, and unoccupied.
      [WordNet 1.5]

   2. Inhabited, lived-in, tenanted; having residents; -- of
      dwelling units. [Narrower terms: owner-occupied] WordNet
      1.5]

   3. Overrun, taken over; -- of countries or territories; as,
      occupied France. Opposite of unoccupied.
      [WordNet 1.5]

   4. Busy; actively or fully engaged in some activity; -- of
      people. Opposite of idle.

   Syn: employed, engaged.
        [WordNet 1.5]

The Collaborative International Dictionary of English v.0.48:

Occupy \Oc"cu*py\, v. t. [imp. & p. p. Occupied; p. pr. & vb.
   n. Occupying.] [OE. occupien, F. occuper, fr.L. occupare;
   ob (see Ob-) + a word akin to capere to take. See
   Capacious.]
   1. To take or hold possession of; to hold or keep for use; to
      possess.
      [1913 Webster]

            Woe occupieth the fine [end] of our gladness.
                                                  --Chaucer.
      [1913 Webster]

            The better apartments were already occupied. --W.
                                                  Irving.
      [1913 Webster]

   2. To hold, or fill, the dimensions of; to take up the room
      or space of; to cover or fill; as, the camp occupies five
      acres of ground. --Sir J. Herschel.
      [1913 Webster]

   3. To possess or use the time or capacity of; to engage the
      service of; to employ; to busy.
      [1913 Webster]

            An archbishop may have cause to occupy more
            chaplains than six.                   --Eng. Statute
                                                  (Hen. VIII. )
      [1913 Webster]

            They occupied themselves about the Sabbath. --2
                                                  Macc. viii.
                                                  27.
      [1913 Webster]

   4. To do business in; to busy one's self with. [Obs.]
      [1913 Webster]

            All the ships of the sea, with their mariners, were
            in thee to occupy the merchandise.    --Ezek. xxvii.
                                                  9.
      [1913 Webster]

            Not able to occupy their old crafts.  --Robynson
                                                  (More's
                                                  Utopia).
      [1913 Webster]

   5. To use; to expend; to make use of. [Obs.]
      [1913 Webster]

            All the gold that was occupied for the work. --Ex.
                                                  xxxviii. 24.
      [1913 Webster]

            They occupy not money themselves.     --Robynson
                                                  (More's
                                                  Utopia).
      [1913 Webster]

   6. To have sexual intercourse with. [Obs.] --Nares.
      [1913 Webster]

WordNet (r) 3.0 (2006):

occupied
    adj 1: held or filled or in use; "she keeps her time well
           occupied"; "the wc is occupied" [ant: unoccupied]
    2: seized and controlled as by military invasion; "the occupied
       countries of Europe" [ant: unoccupied]
    3: resided in; having tenants; "not all the occupied (or
       tenanted) apartments were well kept up" [syn: occupied,
       tenanted]
    4: having ones attention or mind or energy engaged; "she keeps
       herself fully occupied with volunteer activities"; "deeply
       engaged in conversation" [syn: engaged, occupied]