Why were northerners called Yankees during civil war?

Answer 1

Yankee had long been a term used to describe people from New England. Southerners generalized the term to include all Northerners. The source of the widespread use among southerners to refer to northerners as Yankees may have been mistral shows plying the Mississippi on showboats.

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Actually, the word is even older than that. Yankee1683, a name applied disparagingly by Dutch settlers in New Amsterdam (New York) to English colonists in neighboring Connecticut. It may be from Du. Janke, lit. "Little John," dim. of common personal name Jan; or it may be from Jan Kes familiar form of "John Cornelius," or perhaps an alteration of Jan Kees, dialectal variant of Jan Kaas, lit. "John Cheese," the generic nickname the Flemings used for Dutchmen. It originally seems to have been applied insultingly to the Dutch, especially freebooters, before they turned around and slapped it on the English. A less-likely theory is that it represents some southern New England Algonquian language mangling of English. In English a term of contempt (1750s) before its use as a general term for "native of New England" (1765); during the American Revolution it became a disparaging British word for all American native or inhabitants. Shortened form Yank in reference to "an American" first recorded 1778.

Answer 2

They were called Rebels.