The Collaborative International Dictionary of English v.0.48:

Privilege \Priv"i*lege\, v. t. [imp. & p. p. Privileged; p.
   pr. & vb. n. Privileging.] [Cf. F. privil['e]gier.]
   [1913 Webster]
   1. To grant some particular right or exemption to; to invest
      with a peculiar right or immunity; to authorize; as, to
      privilege representatives from arrest.
      [1913 Webster]

            To privilege dishonor in thy name.    --Shak.
      [1913 Webster]

   2. To bring or put into a condition of privilege or exemption
      from evil or danger; to exempt; to deliver.
      [1913 Webster]

            He took this place for sanctuary, And it shall
            privilege him from your hands.        --Shak.
      [1913 Webster]

The Collaborative International Dictionary of English v.0.48:

Privileged \Priv"i*leged\, a.
   Invested with a privilege; enjoying a peculiar right,
   advantage, or immunity.
   [1913 Webster]

   Privileged communication. (Law)
   (a) A communication which can not be disclosed without the
       consent of the party making it, -- such as those made by
       a client to his legal adviser, or by persons to their
       religious or medical advisers.
   (b) A communication which does not expose the party making it
       to indictment for libel, -- such as those made by persons
       communicating confidentially with a government, persons
       consulted confidentially as to the character of servants,
       etc.

   Privileged debts (Law), those to which a preference in
      payment is given out of the estate of a deceased person,
      or out of the estate of an insolvent. --Wharton.
      --Burrill.

   Privileged witnesses (Law) witnesses who are not obliged to
      testify as to certain things, as lawyers in relation to
      their dealings with their clients, and officers of state
      as to state secrets; also, by statute, clergymen and
      physicans are placed in the same category, so far as
      concerns information received by them professionally.
      [1913 Webster]

WordNet (r) 3.0 (2006):

privileged
    adj 1: blessed with privileges; "the privileged few" [ant:
           underprivileged]
    2: not subject to usual rules or penalties; "a privileged
       statement"
    3: confined to an exclusive group; "privy to inner knowledge";
       "inside information"; "privileged information" [syn:
       inside, inner, privileged]

Moby Thesaurus II by Grady Ward, 1.0:

52 Moby Thesaurus words for "privileged":
   admitted, advantaged, auricular, authorized, between us, chartered,
   confidential, elite, empowered, enfranchised, entitled, esoteric,
   excepted, excused, exempt, exempted, favored, franchised, honored,
   hush-hush, immune, in petto, indulged, inside, irresponsible,
   let off, licensed, not for publication, off the record, patented,
   permitted, powerful, private, privy, protected, released,
   restricted, rich, ruling, sanctioned, sealed, secret, spared,
   special, unaccountable, unanswerable, under privilege, unliable,
   unpublishable, unsubject, warranted, wealthy