You know what...even I'm not sure where the term came from.
I found this while doing a Yahoo search...
The Word "Hoosier"
For well over a century and a half the people of Indiana have been called Hoosiers. It is one of the oldest of state nicknames and has had a wider acceptance than most. True, there are Buckeyes of Ohio, the Suckers of Illinois and the Tarheels of North Carolina -- but none of these has had the popular usage accorded Hoosier.
But where did Hoosier come from? What is its origin? We know that it came into general usage in the 1830s. John Finley of Richmond wrote a poem, "The Hoosier's Nest," which was used as the "Carrier's Address" of the Indianapolis Journal, Jan. 1, 1833. It was widely copied throughout the country and even abroad. Finley originally wrote Hoosier as "Hoosher." Apparently the poet felt that it was sufficiently familiar to be understandable to his readers. A few days later, on Jan. 8, 1833, at the Jackson Day dinner in Indianapolis, John W. Davis offered "The Hoosher State of Indiana" as a toast. And in August, former Indiana Gov. James B. Ray announced that he intended to publish a newspaper, The Hoosier, at Greencastle, Indiana.
A few instances of the earlier written use of Hoosier have been found. The word appears in the "Carrier's Address" of the Indiana Democrat on Jan. 3, 1832. G. L. Murdock wrote on Feb. 11, 1831, in a letter to Gen. John Tipton, "Our Boat will [be] named the Indiana Hoosier." In a publication printed in 1860, Recollections . . . of the Wabash Valley, Sanford Cox quotes a diary which he dates July 14, 1827, "There is a Yankee trick for you -- done up by a Hoosier." One can only wonder how long before this Hoosier was used orally.
As soon as the nickname came into general use, speculation began as to its origin. Among the more popular theories:
- When a visitor hailed a pioneer cabin in Indiana or knocked upon its door, the settler would respond, "Who's yere?" And from this frequent response Indiana became the "Who's yere" or Hoosier state. No one ever explained why this was more typical of Indiana than of Illinois or Ohio.
- Indiana rivermen were so spectacularly successful in trouncing or "hushing" their adversaries in the brawling that was then common that they became known as "hushers," and eventually Hoosiers.
- There was once a contractor named Hoosier employed on the Louisville and Portland Canal who preferred to hire laborers from Indiana. They were called "Hoosier's men" and eventually all Indianans were called Hoosiers.
- A theory attributed to Gov. Joseph Wright derived Hoosier from an Indian word for corn, "hoosa." Indiana flatboatmen taking corn or maize to New Orleans came to be known as "hoosa men" or Hoosiers. Unfortunately for this theory, a search of Indian vocabularies by a careful student of linguistics failed to reveal any such word for corn.
Quite as possible is a facetious explanation offered by "The Hoosier Poet," James Whitcomb Riley. He claimed that Hoosier originated in the pugnacious habits of our early settlers. They were enthusiastic and vicious fighters who gouged, scratched and bit off noses and ears. This was so common an occurrence that a settler coming into a tavern the morning after a fight and seeing an ear on the floor would touch it with his toe and casually ask, "Whose ear?"
Many have inquired into the origin of Hoosier. But by all odds the most serious student of the matter was Jacob Piatt Dunn, Jr., Indiana historian and longtime secretary of the IHS. Dunn noted that "hoosier" was frequently used in many parts of the South in the 19th century for woodsmen or rough hill people. He traced the word back to "hoozer," in the Cumberland dialect of England. This derives from the Anglo-Saxon word "hoo" meaning high or hill. In the Cumberland dialect, the world "hoozer" meant anything unusually large, presumably like a hill. It is not hard to see how this word was attached to a hill dweller or highlander. Immigrants from Cumberland, England, settled in the southern mountains (Cumberland Mountains, Cumberland River, Cumberland Gap, etc.). Their descendents brought the name with them when they settled in the hills of southern Indiana.
As Indiana writer Meredith Nicholson observed: "The origin of the term 'Hoosier' is not known with certainty. But certain it is that . . . Hoosiers bear their nickname proudly."