Southern U.S. derogatory term for "poor, white trash" (1766), probably an agent noun from crack (v.) in the sense "to boast" (as in not what it's cracked up to be). Cracker "a boaster, a braggart" is attested from c. 1500; also see crack (n.). Compare Latin crepare "to rattle, crack, creak," with a secondary figurative sense of "boast of, prattle, make ado about."
I should explain to your Lordship what is meant by crackers; a name they have got from being great boasters; they are a lawless set of rascalls on the frontiers of Virginia, Maryland, the Carolinas and Georgia, who often change their places of abode. [letter from colonial officer Gavin Cochrane to the Earl of Dartmouth, June 27, 1766]
But DARE compares corn-cracker "Kentuckian," also "poor, low-class white farmer of Georgia and North Carolina" (1835, U.S. Midwest colloquial).
The word was used especially of Georgians by 1808, though often extended to residents of northern Florida. Another name in mid-19c. use was sand-hiller "poor white in Georgia or South Carolina."
Not very essentially different is the condition of a class of people living in the pine-barrens nearest the coast [of South Carolina], as described to me by a rice-planter. They seldom have any meat, he said, except they steal hogs, which belong to the planters, or their negroes, and their chief diet is rice and milk. "They are small, gaunt, and cadaverous, and their skin is just the color of the sand-hills they live on. They are quite incapable of applying themselves steadily to any labor, and their habits are very much like those of the old Indians." [Frederick Law Olmsted, "A Journey in the Seaboard Slave States," 1856]