Alcohol is a traditional social-bonding reinforcer; however, the neural mechanism underlying ethanol-driven social behaviors remains elusive. Here, we report that ethanol facilitates observational fear response. Observer mice exhibited stronger defensive immobility while observing cagemates that received repetitive foot shocks if the observer mice had experienced a brief priming foot shock. This enhancement was associated with an observation-induced recruitment of subsets of anterior cingulate cortex (ACC) neurons in the observer mouse that were responsive to its own pain. The vicariously activated ACC neurons projected their axons preferentially to the basolateral amygdala. Ethanol shifted the ACC neuronal balance toward inhibition, facilitated the preferential ACC neuronal recruitment during observation, and enhanced observational fear response, independent of an oxytocin signaling pathway. Furthermore, ethanol enhanced socially evoked fear response in autism model mice.