The Collaborative International Dictionary of English v.0.48:

Bonfire \Bon"fire`\, n. [OE. bonefire, banefire, orig. a fire of
   bones; bone + fire; but cf. also Prov. E. bun a dry stalk.]
   A large fire built in the open air, as an expression of
   public joy and exultation, or for amusement.
   [1913 Webster]

         Full soon by bonfire and by bell,
         We learnt our liege was passing well.    --Gay.
   [1913 Webster]

WordNet (r) 3.0 (2006):

bonfire
    n 1: a large outdoor fire that is lighted as a signal or in
         celebration [syn: bonfire, balefire]