The origins of the Tar Heel nickname can be traced back to North Carolina's prominence from the mid-18th to the 19th century as a producer of turpentine, tar, tar and other materials from the state's abundant pine trees. During the Civil War, soldiers changed the meaning and turned it into an award. They called themselves “tar heels” as an expression of state pride. North Carolina became widely known as the “tar heel state.” Before the American Revolutionary War, North Carolina supplied much of the naval tar needed for English ships.
An undated example comes, once again, from a meeting between soldiers from Virginia and the Pettigrew Brigade of North Carolina. In a fierce battle in Virginia, where their support column was driven from the field, North Carolina troops stood alone and fought successfully. In a story set during the Civil War, in 1863, North Carolina soldiers stood firm during a battle, even after a Virginia regiment had withdrawn. Tar leaks into the story in an account of the transport of prisoners from North Carolina to Fort Lafayette in Staten Island.
The UNC's explanation of the term Tar Heel refers to North Carolina's economic history as one of the leading producers of turpentine supplies for the shipbuilding industry. In 1893, students at the University of North Carolina founded a newspaper and named it The Tar Heel. During the Civil War, North Carolina soldiers changed the meaning of the term and turned an epithet into an award. Eventually, Parliament offered a reward for its production, and North Carolina became an important source of tar and tar for the English navy.
The first use I have found for the term “rosin heel” does not come from North Carolina, but from West Florida around 1820. Along with significant areas of dissent in the mountains and parts of the central region of the state, eastern North Carolina was an area of “flexible loyalties,” as Judkin Browning points out. The first use I have found of North Carolina soldiers called “Tar Heels” comes from the Battle of the Seven Days in late June 1862 near Manchester, Virginia. What keeps the nickname of the tar heel vibrant in large part are the sports teams at the University of North Carolina.
After this, the use of the term became even more widespread, and by the end of the war, “Tar Heel seems to have been in general use to describe not only North Carolina soldiers, but anyone from the tar, tar and turpentine state. Eastern North Carolina wasn't immune to this new cotton boom, but cotton didn't displace the turpentine industry there as it did elsewhere.