The co-founder of Alcoholics Anonymous (AA) believed LSD could be used to cure alcoholics and credited the drug with helping his own recovery from often debilitating depression, according to new research.

About 20 years after setting up the Ohio-based sobriety movement in 1935, Bill Wilson came to believe that LSD could help "cynical alcoholics" achieve a "spiritual awakening" and start on the path to recovery.

The discovery that Wilson considered using the drug as an aid to recovery for addicts was made by Don Lattin, author of a book to be published in October by the University of California Press, entitled Distilled Spirits.

Lattin found letters and documents revealing that Wilson at first struggled with the idea that one drug could be used to overcome addiction to another. LSD, which was first synthesised in 1938, is a non-addictive drug that alters thought processes and can inspire spiritual experiences. Wilson thought initially the substance could help others understand the alcohol-induced hallucinations experienced by addicts, and that it might terrify drinkers into changing their ways.

But after his first acid trip, at the Veterans Administration (VA) hospital in Los Angeles on 29 August 1956, Wilson began to believe it was insight, not terror, that could help alcoholics recover.

LSD, by mimicking insanity, could help alcoholics achieve a central tenet of the Twelve Step programme proposed by AA, he believed. It was a matter of finding "a power greater than ourselves" that "could restore us to sanity". He warned: "I don't believe [LSD] has any miraculous property of transforming spiritually and emotionally sick people into healthy ones overnight. It can set up a shining goal on the positive side, after all it is only a temporary ego-reducer."

But Wilson added: "The vision and insights given by LSD could create a large incentive – at least in a considerable number of people."

His words were found in a late 50s letter to Father Ed Dowling, a Catholic priest and member of an experimental group he had formed in New York to explore the spiritual potential of LSD.

Wilson is known to have taken LSD in supervised experiments in the 1950s with Betty Eisner, an American psychologist known for pioneering use of LSD and other psychedelic drugs as adjuncts to psychotherapy, and Sidney Cohen, a psychiatrist in Los Angeles.

Wilson also discussed, in great detail, taking LSD with the author Aldous Huxley, and it is likely, though not proven, that the pair experimented with the drug together.

"I am certain that the LSD experiment has helped me very much," Wilson wrote in a 1957 letter to the science writer and philosopher Gerald Heard. "I find myself with a heightened colour perception and an appreciation of beauty almost destroyed by my years of depressions."

In a talk given in 1976, Humphry Osmond, the British psychiatrist who coined the word "psychedelic", said he told Wilson in 1956 "that [LSD] was good news".

Osmond said: "But [Wilson] was far from pleased with the idea of alcoholics being assailed by some strange chemical. Later on Bill got extremely interested and … he likened his LSD experience to his earlier vision of seeing this chain of drunks around the world, all helping each other. This caused various scandals in AA. They were very ambivalent about their great founder taking LSD, yet they wouldn't have existed if he hadn't been of an adventurous kind of mind."

Lattin also found letters in which Eisner described Wilson's thoughts when attending the VA hospital in 1956 to take LSD in a controlled experiment with herself, Cohen and Wilson's wife, Lois. "Alcoholics Anonymous was actually considering using LSD," Eisner wrote. "Alcoholics get to a point in the [programme] where they need a spiritual experience but not all of them are able to have one."

In a letter to Heard in September 1956, shortly after his first LSD experience, Wilson admitted he was appreciating the drug's value. "I do feel a residue of assurance and a feeling of enhanced beauty that seems likely to stay by me."

A few months on Wilson was yet more positive about the long-term benefits. "More and more it appears to me that the experience has done a sustained good," he wrote to Heard on 4 December 1956. "My reactions to things totally, and in particular, have very definitely improved for no other reason that I can see."

Lattin said Wilson was "so intrigued by the spiritual potential of LSD" he formed the experimental group that included Dowling, and Eugene Exman, Harper's religious book editor. Wilson, however, remained sensitive to the controversy of his experiments. In a letter to Cohen, written between 1956 and 1961, he reported hearing gossip about his LSD use in AA circles. He reminded Cohen about "the desirability" of omitting his name "when discussing LSD with AAs". Cohen reassured Wilson that his LSD trials did not include other active AA members.

In 1958 Wilson defended his drug use in a long letter but soon afterwards removed himself from the AA governing body to be free to do his experiments.

According to the anonymous author of his official biography, Wilson felt LSD "helped him eliminate many barriers erected by the self, or ego, that stand in the way of one's direct experiences of the cosmos and of god". He "thought he might have found something that could make a big difference to the lives of many who still suffered".

But, according to Pass It On, published in 1984 by AA World Services in New York, the movement was totally against his suggestions. "As word of Bill's activities reached the fellowship there were inevitable repercussions. Most AAs were violently opposed to his experimenting with a mind-altering substance. LSD was then totally unfamiliar, poorly researched, and entirely experimental – and Bill was taking it."