[HibeeJibee]

From wikipedia;
"The invention of the penalty kick is credited to the goalkeeper and businessman William McCrum in 1890 in Milford, County Armagh, Northern Ireland. The Irish Football Association presented the idea to the International Football Association Board and finally after much debate, the board approved the idea on 2 June 1891. It was introduced in the 1891-92 season."

In terms of the penalty shoot-out:
The penalty shootout is usually credited as the invention of former referee Karl Wald, from Frankfurt-am-Main. When proposed in 1970, the Bavarian football association attempted to block the suggestion, and it was only when the majority of delegates said they were in favour that the officials gave their backing.
Israeli Yosef Dagan is also claimed by some to have invented the method, after the Israeli national football team was eliminated from the 1968 Summer Olympics semi-finals due to a coin toss.
Initially, teams did not alternate their kicks. One side kicked five times, followed by the other. The shootout ended as soon as the winner became obvious. In case of a draw, both teams had a second round of five kicks each until a winner was decided. Alternation was introduced by 1976.

The first ever penalty shoot-out in top-level football was believed to be in the Watney Cup (English equivalent of the Drybrough Cup) between Hull City and Manchester Utd. George Best was the first ever to take a penalty, and scored, while Denis Law was the first to miss one. Hull keeper Ian McKechnie was the first keeper to save a penalty, he took the deciding kick and missed and was therefore the first player to 'lose' a penalty shoot-out for this team.........

[Fudge]

HibeeJibee, on May 12 2007, 15:55, said:

Hull keeper Ian McKechnie was the first keeper to save a penalty, he took the deciding kick and missed and was therefore the first player to 'lose' a penalty shoot-out for this team.........

Interestingly enough, Ian McKechnie is the uncle of p&b poster Adam Wee, now BDV