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Hatteras Indians. An Algonquian tribe living in 1701 on the sand banks of Cape Hatteras, North Carolina east of Pamlico sound, and frequenting Roanoke Island. Their single village, Sandbanks, had them only about 80 inhabitants. They showed traces of white blood and claimed that some of their ancestors were white. They may have been identical with the Croatan Indians with whom Raleigh’s colonists at Roanoke Island are supposed to have taken refuge.