The OED entry on jail | gaol, n. wrote:Middle English had two types, from Northern or Norman French, and Central or Parisian French respectively:
Of the two types, the Norman French and Middle English gaiole , gaole , came down to the 17th cent. as gaile , and still remains as a written form in the archaic spelling gaol (chiefly due to statutory and official tradition); but this is obsolete in the spoken language, where the surviving word is jail , repr. Old Parisian French and Middle English jaiole , jaile . Hence though both forms gaol , jail , are still written, only the latter is spoken. In U.S. jail is the official spelling. It is difficult to say whether the form goal(e , common, alike in official and general use, from the 16th to the 18th cent., was merely an erroneous spelling of gaol , after this had itself become an archaism, or was phonetic: compare modern French geôle /ʒol/ .
Also, a couple of blogs I ran across suggested that Australia is the only place left where <gaol> is the standard, with England only using it in legal language.