Final answer:
The word 'otis' in the sentence needs to be capitalized as it is a proper noun, the name of the student's childhood pet.
Step-by-step explanation:
The word that needs to be capitalized in the sentence 'My first childhood pet, a gray cat named otis, was given to me as a gift on my fifth birthday.' is 'otis.'
In this sentence, 'Otis' is a proper noun since it is the name of a specific cat and, therefore, should have its first letter capitalized according to standard English capitalization rules.
These rules state that proper nouns such as names of people, pets, cities, and countries, always require a capital letter at their start. Since it is the name of the pet, the correct way to write it would be 'Otis.'