Slang for being pleasantly, mildly drunk — that sweet spot where you're loose and cheerful but haven't crossed into messy territory yet. The 'bag' likely refers to a bag of booze, and being 'half in' suggests you've only gone partway. It's a far less alarming description than 'wasted' or 'hammered', capturing that convivial glow of a good evening out. Widely used in North America and understood across most English-speaking countries.
By the time dinner was over we were all half in the bag and singing along to the jukebox.
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Regional slang from around the English-speaking world — British, Australian, Irish, Caribbean, Nigerian, Filipino, AAVE, and the hyphenated-English dialects that make the internet sound local.
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(slang) mildly drunk, or nearly drunk.
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