The earliest version of this story that I've been able to find dates back to at least the seventeenth century, probably earlier. It's probably a French story and part of the oral tradition. It definitely predates the versions recorded by Charles Perrault in 1697 and by Jacob and Wilhelm Grimm in 1812.
According to Adam Douglas' minutely-researched and chop-lickingly-good history of werewolf lore, "The Beast Within," the story is also very similar to a story told by the Chinese at about the same time -- one of the few differences in the two stories is that the villain in the Chinese story is a ravenous tiger.
Pull up a chair, little one. I'll tell you an old story you've never heard before...
A woman gave her daughter a loaf of bread and some milk and told the girl to take the food to her grandmother, who lived deep in the forest. The little girl started on her way, but when she reached the crossroads, she met a werewolf, who asked her where she was going.
"I'm taking some bread and milk to my grandmother," the girl answered.
"What road will you take?" asked the werewolf. "The Needles Road or the Pins Road?"
"I believe I will take the Needles Road," the girl replied.
"Then I'll go by the Pins Road," said the werewolf.
The little girl walked slowly and entertained herself by picking up and playing with needles, but the werewolf ran ahead and reached the grandmother's house first. He killed the old woman and ate her, but he put some of her flesh in the pantry and a bottle of her blood on the shelf.
When the little girl reached the house, she knocked on the door, and the werewolf called for her to enter. He told her to put the bread and milk in the pantry and offered her some of the meat and the bottle of wine.
While the little girl ate, a cat crept into the house and said, "Only a slut would eat the flesh and drink the blood of her grandmother!"
Then the werewolf said, "Undress, my child, and come sleep next to me."
"Where shall I put my apron, grandmother?" asked the girl.
"Throw it in the fire, my child. You will not need it anymore."
As the little girl took off each article of her clothing, she asked where she should put them, and each time, the werewolf answered, "Throw it in the fire, my child. You will not need it anymore."
As the girl got into the bed, she said, "Oh, grandmother, how hairy you are!"
"It is to keep me warmer in the night, my child."
"Oh, grandmother, your nails are so long!"
"They are to scratch me better, my child."
"Grandmother, why are your shoulders so broad?"
"It is from carrying kindling in from the woods, my child."
"Oh, grandmother, your ears are so big!"
"The better to hear you with, my child."
"Oh, grandmother, what big teeth you have!"
"The better to eat you with, my child."
But the girl said, "Wait, grandmother! I have to go outside to relieve myself!"
"Do it in the bed, my child."
"No, grandmother, I want to go outside!"
"Very well, but don't take long."
The werewolf tied some yarn around the girl's foot and let her go outside. But the girl tied the yarn to a tree and ran for her home. When the werewolf discovered her trick, he chased after her, but the girl was able to get to her home just ahead of the werewolf.
Differences, differences. They seem so insignificant on the surface, but once you get under the skin, they are so much more interesting. First, the girl is never named in this story -- none of Perrault's Little Red Riding Hood or the Grimms' Little Red Cap. There's no information about her appearance either; she seems designed for little girls of all sorts to identify with. Also, the antagonist is no longer a cartoonish wolf who dresses in a nightgown and bonnet and speaks with a quavering falsetto; this werewolf comes close on the heels of the infamous werewolf trials and werewolf attacks that seemed to plague Europe through much of the Middle Ages. Its motives are not mischief or simple mayhem -- its only goals are corrupting and eating little girls.
And speaking of corruption, this story drops the little girl through depths of sin rarely visited by even the harshest of the Grimm tales. She indulges in cannibalism and even vampirism as she polishes off her grandma's remains. Even a fairly explicit warning from a mysterious talking cat doesn't sway her from her path, and that odd little seduction scene follows. And let me be quite clear: as far as I'm concerned, the girl knew what was happening. At this time in history, she may have been quite close to marrying age and probably knew more about sex than most girls her age today. And the capper: the werewolf tries to get her to commit the greatest sin of childhood -- he tells her to wet the bed. It's fairly interesting that she indulges in a number of mortal sins, seemingly without feeling guilt, but she balks at soiling the bed. Perhaps that's what saves her...
Nevertheless, not a story for children. Or rather, not a story for good children.
Research from "The Beast Within: A History of the Werewolf" by Adam Douglas, published by Avon Books in 1992, pp. 208-220.