Old English hær "hair, a hair," from Proto-Germanic *khæran (cf. Old Saxon, Old Norse, Old High German har, Old Frisian her, Dutch and German haar "hair"), perhaps from PIE *ghers- "to stand out, to bristle, rise to a point" (cf. Lithuanian serys "bristle;" see horror).
Spelling influenced by Old Norse har and Old English haire "haircloth," from Old French haire, from Frankish *harja or some other Germanic source (see above). To let one's hair down "become familiar" is first recorded 1850. Phrase hair of the dog that bit you (1540s), homeopathic remedy, is in Pliny.