'baile' (Spanish) ultimately traces to Late Latin 'ballare' meaning 'to dance' (from earlier Greek/Italic roots associated with dancing). 'baile' (Irish) comes from Old Irish 'baile' meaning 'homestead, town', an inherited Celtic term used for settlements.

The Spanish 'baile' developed from Late Latin 'ballare' > Old Spanish 'ballar/baile' and became the modern Spanish noun 'baile'. The Irish 'baile' is recorded in Old Irish with the same form and passed into Modern Irish; in English toponymy it was anglicized as 'bally-' (e.g. Ballymena).

In Spanish, the root originally referred to the action 'to dance' and evolved into a common noun 'dance' and related event meanings. In Irish, the meaning has remained focused on 'home/settlement' and has been retained in place-names.