In doing some research, I stumbled across this tidbit...and I quote...

"Demon
(Greek daimon and daimonion, Lat. daemonium).

The word demon is apparently derived from daio "to divide" or "apportion", originally meant a divine being; 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.

A similar change and deterioration of meaning has taken place in the Iranian languages in the case of the word daeva. Etymologically this is identical with the Sanskrit deva, by which it is rendered in Neriosengh's version of the Avesta. For the original meaning of the word is "shining one", and it comes from a primitive Aryan root div, which is likewise the source of the Greek Zeus and the Latin deus. But whereas the devas of Indian theology are good and beneficent gods, the daevas of the Avesta are hateful spirits of evil. " end quote


Thanks to the good folks at http://www.demons.monstrous.com for the definition!