A fuzzy navel is a mixed drink made from peach schnapps and orange juice. Generally an equal amount of each component is used to concoct it, although quantities may vary. It can also be made with lemonade[1] or a splash of vodka depending on the drinker's taste. By adding 1 or 1½ oz of vodka to the fuzzy navel you have what is called a hairy navel, the more "hair" referring to the increased strength of alcohol in the drink.
The fuzzy navel was one of the first drinks to arise in the new popularity of cocktails and mixed drinks in the 1980s. It was created by Doug Schuster in Dublin, Ohio who was working for National Distillers at the time. National Distillers owned the right to distribute a new product from DeKuyper called Peachtree Schnapps. Doug was tasked with creating new drinks containing the Schnapps. He found that it tasted best when mixed with orange juice. He christened it the "Fuzzy Navel" after the marketing department came up with the slogan, "You can taste the fuzz".
A competing claim has its origination in Omaha Nebraska at the Wagon Tongue Bar. It was mixed by Jack Sherman, who worked for Phillips & Sons Liquor, who gave it the name "fuzzy navel".
This fashion was described by New York Times critic William Grimes as "a kind of cult, rallying points for young drinkers in search of fun and not too picky about taste".[2]
"Fuzzy" in the name refers to the peach, and "navel" to the orange.