You'll need to draw or print out two Battleships game boards, with squares large enough to fit shot glasses on. You'll also need enough shot glasses to form the following ships for each player:
Destroyer - two shot glasses
Submarine - three shot glasses
Cruiser - three shot glasses
Battleship - four shot glasses
Aircraft carrier - five shot glasses
Each player places their 'ships' (made up of a number of shot glasses) on their game board and fills the shot glasses with the drink(s) of their choice. It's important to ensure that each player's game board cannot be seen by their opponent (propped up pizza boxes are good for this).
The players take it in turns to guess a coordinate on their opponent's game board. If the coordinate they guess has a shot glass on it their opponent must drink its contents and remove it from the board.
The winner is the first player to destroy all of their opponents ships (i.e. make their opponent drink all of their shots).