The Collaborative International Dictionary of English v.0.48:

Alpaca \Al*pac"a\, n. [Sp. alpaca, fr. the original Peruvian
   name of the animal. Cf. Paco.]
   1. (Zool.) An animal of Peru (Lama paco), having long,
      fine, wooly hair, supposed by some to be a domesticated
      variety of the llama.
      [1913 Webster]

   2. Wool of the alpaca.
      [1913 Webster]

   3. A thin kind of cloth made of the wooly hair of the alpaca,
      often mixed with silk or with cotton.
      [1913 Webster]