late 14c., from hole (n.) + -y (2). The -e- is there to distinguish it in text from holy.
Entries linking to holey
hole n.
Old English hol (adj.) "hollow, concave;" as a noun, "hollow place; cave; orifice; perforation," from Proto-Germanic *hulan (source also of Old Saxon, Old Frisian, Old High German hol, Middle Dutch hool, Old Norse holr, German hohl "hollow," Gothic us-hulon "to hollow out"), from PIE root *kel- (1) "to cover, conceal, save." As an adjective, it has been displaced by hollow, which in Old English was only a noun, meaning "excavated habitation of certain wild animals."
As a contemptuous word for "small dingy lodging or abode" it is attested from 1610s. Meaning "a fix, scrape, mess" is from 1760. Obscene slang use for "vulva" is implied from mid-14c. Golfing hole-in-one is from 1914; as a verbal phrase from 1913. To need (something) like a hole in the head, applied to something useless or detrimental, first recorded 1944 in entertainment publications, probably a translation of a Yiddish expression such as ich darf es vi a loch in kop.
-y 2
adjective suffix, "full of or characterized by," from Old English -ig, from Proto-Germanic *-iga- (source also of Dutch, Danish, German -ig, Gothic -egs), from PIE -(i)ko-, adjectival suffix, cognate with elements in Greek -ikos, Latin -icus (see -ic). Originally added to nouns in Old English; used from 13c. with verbs, and by 15c. even with other adjectives (for example crispy). Adjectives such as hugy, vasty are artificial words that exist for the sake of poetical metrics.