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The term demon means 'replete with wisdom'.  Demon is derived from the Greek term daimon, or 'divine power', 'fate' or 'god'.  It was occasionally applied to the higher gods and goddesses, but was more generally used to denote spiritual beings of a lower order coming between gods and men. It is now practically restricted to the evil spirits.

Historically, demons have been controlled by magicians and sorcerers.  In ancient Egypt, it was believed that a magician who exorcised a demon responsible for a possession would be just as likely to use the same demon to other ends.
Demons have been exorcised as the causes of disease, misfortune and possession.  A person who is demonically possessed suffers from a complete takeover of his or her personality by a diabolical entity, allowing the entity to dominate; the victim becomes, even somewhat physically, that demonic being.  In the past, apparent demonic possession commonly was blamed on bewitchment, when in fact the causes often were hysterical fantasies, physical and mental disorders and repressed sexual desire.  Nevertheless the Roman Catholic Church does continue (sparingly) to perform exorcisms to this day.

Even now within many tribal societies, demons are blamed for a wide range of misfortunes and illnesses.

          
Species of Demons, as Described by Alphonse de Spina (1467)

Fates, who alter destiny
Poltergeists, who causes mischief
Incubi and Succubi, who stimulate lust and perversion
Marching Hordes, who bring about war
Familiars, who assist witches
Nightmares, who disturb sleep through bad dreams
Demons formed from Human Semen
Disguised Demons
Demons who Assail the Saintly
Demons who Instigate Witchcraft