Yes, excessive alcohol is neurotoxic.
This has been proven beyond any reasonable doubt; there is a substantial body of research in the field going back for quite some time. Evidence for this comes from a wide range of animal based research (for examples, see Crews FT, Nixon K (2009) Mechanisms of neurodegeneration and regeneration in alcoholism. Alcohol and Alcoholism 44:115. & Obernier JA, Bouldin TW, Crews FT (2002) Binge Ethanol Exposure in Adult Rats Causes Necrotic Cell Death. Alcoholism: Clinical and Experimental Research 26:547-557.) as well as clinical studies in human populations (eg: Harper C (2007) The neurotoxicity of alcohol. Human & Experimental Toxicology 26:251.).
However, there is also some evidence that low-to-moderate alcohol consumption may have neuroprotective effects: see Ruitenberg A, van Swieten JC, Witteman J, Mehta KM, van Duijn CM, Hofman A, Breteler M (2002) Alcohol consumption and risk of dementia: the Rotterdam Study.
The Lancet 359:281-286.
There is still considerable dispute within the research community about the exact mechanisms of alcohol-induced neurotoxicity. Likely candidates include oxidative stress, inflammation-related cerebral overpressure and glutamatergic excitotoxicity. See Crews FT, Collins MA, Dlugos C, Littleton J, Wilkins L, Neafsey EJ, Pentney R, Snell LD, Tabakoff B, Zou J (2004) Alcohol-induced neurodegeneration: when, where and why? Alcoholism: Clinical and Experimental Research 28:350-364. for an overview of these possibilities.