I got this from wiki:
QUOTE
Silver in European folklore has long been traditionally believed to be an antidote to various maladies and mythical monsters. Notably, silver was believed to be a repellent against vampires (this primarily originates from its holy connotations; also, mirrors were originally polished silver, and as such, vampires allegedly cannot be seen in them because they have no soul) and it was also believed that a werewolf, in his bestial form, could only be killed by a weapon or bullet made of silver. This has given rise to the term "silver bullet", which is used to describe things that very effectively deal with one specific problem.