From Bill Bryson‘s A Short History of Nearly Everything (2003) Chapter Four:
“…Nevil Maskelyne (1732-1811), the Astronomer Royal (and) the astronomer and surveyor Charles Mason (1728-1786) had become friends eleven years earlier (1761) while engaged in a project to measure an astronomical event of great importance: the passage of the planet Venus across the face of the Sun…
Unfortunately, transits of Venus, as they are known, are an irregular occurrence…
…(in comparison), the disappointments experienced by Britain’s eighteen scattered observers were mild. Mason found himself paired with a young surveyor named Jeremiah Dixon (1733-1779) and apparently they got along well, for they formed a lasting partnership…Mason and Dixon sent a note to the Royal Society observing that it seemed awfully dangerous on the high seas and wondering if perhaps the whole thing oughtn’t to be called off. In reply they received a swift and chilly rebuke, noting that they had already been paid, that the nation and scientific community were counting on them, and that their failure to proceed would result in the irretrievable loss of their reputations…
Soon afterwards Maskelyne returned to England, where he became Astronomer Royal, and Mason and Dixon – now evidently more seasoned – set off for four long and often perilous years surveying their way through 244 miles of dangerous American wilderness to settle a boundary dispute between the estates of William Penn and Lord Baltimore and their respective colonies of Pennsylvania and Maryland. The result was the famous Mason-Dixon Line, which later took on symbolic importance as the dividing line between the slave and free states. (Although the Line wasn’t their principal task, they also contributed several astronomical surveys, including one of the century’s most accurate measurements of a degree of meridian – an achievement that brought them far more acclaim in England than the settling of a boundary dispute between spoiled aristocrats.)”
“As a definite geographic location within the United States, “Dixie” is usually defined as the eleven Southern states that seceded in late 1860 and early 1861 to form the new Confederate States of America. They are (in order of secession): South Carolina, Mississippi, Florida, Alabama, Georgia, Louisiana, Texas, Virginia, Arkansas, North Carolina, and Tennessee. Maryland never seceded from the Union, but many of its citizens favored the Confederacy.
According to the Oxford English Dictionary, the origin of this nickname remains obscure. The most common theories according to A Dictionary of Americanisms on Historical Principles (1951) by Mitford M. Mathews are:
1 “Dixie” is derived from Jeremiah Dixon, a surveyor of the Mason–Dixon line, which defined the border between Maryland and Pennsylvania, separating free and slave states subsequent to the Missouri Compromise.
2 The word “Dixie” refers to currency issued first by the Citizens State Bank in the French Quarter of New Orleans and then by other banks in Louisiana. These banks issued ten-dollar notes labeled Dix on the reverse side, French for “ten”. The notes were known as “Dixies” by Southerners, and the area around New Orleans and the French-speaking parts of Louisiana came to be known as “Dixieland”. Eventually, usage of the term broadened to refer to the Southern states in general.”