Do you know ghouls from goblins and ghosts?
1772, local, from French local, noun use of local (adj.), from Latin locus "place" (see locus). English spelling with -e (1816) probably is based on morale or else to indicate stress.
The word's right to exist depends upon the question whether the two indispensable words locality & scene give all the shades of meaning required, or whether something intermediate is useful. [Fowler]