A few years ago (somewhere around 1999), I first heard this tale (legend).  The story was basically about why Louisiana owns the barrier islands out in front if Mississippi.  The story I originally got from a state employee that is in a position to know is posted here. It sounded cool, but I had my doubts.   Names have been removed.

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Gene,
The tale is true, this is what I know:
Louisiana was admitted to the union before Mississippi, at that time, Louisiana claimed all waters within three leagues (9 miles) of the shore. Mississippi was admitted later and claimed all waters within 9 leagues of the shore. The problem was determining where the Louisiana shore actually was.
There was a law suit and Louisiana won, and a boundary was established. In those days, Mississippi did not allow oyster dredging by power boats and Louisiana did. The story goes that the Mississippi seafood canners wanted a resurvey of the boundary in an attempt to get more oyster beds into Louisiana's territory so they could dredge with power boats.
A new offshore survey was conducted in a most unusual way. A wooden whiskey barrel was dropped in the mouth of the Pearl River between Hancock County and St. Tammany Parish and its seaward progress was charted. The course of the whiskey barrel would be the new boundary. It is reported that a strong west wind blew the barrel on an easterly course, thus giving Louisiana control over the prime oyster waters. The new survey allowed power boats to fish in Louisiana waters close to the Mississippi coast. Mississippi boats entering Louisiana waters only a short distance offshore had to then pay taxes to Louisiana. Several Mississippi legislators have suggested they would attempt to have the boundary issue brought up for further investigation, but little action has been taken. Whether or not the present offshore line ever will be changed, there are those in Mississippi who feel the "Whiskey Barrel Boundary" was not in the best interest of their state. As far as I can tell, this happened in 1909 or 1910. This is all that I know. Hope it helps.

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Ok, the lack of "facts" got me looking.  I queries multiple sources (libraries, newspapers, etc), and came up with a few "hits".

The Houston Chronicle,  July 22, 1993, Thursday, 2 STAR Edition
SECTION: OUTDOORS; Doug Pike; Pg. 13
The Houston Chronicle, July 9, 1992, Thursday, 3 STAR Edition
SECTION: OUTDOORS; Doug Pike; Pg. 11
The Daily Herald” {Biloxi, MS], January 28^th 1957.
Appeared in a column titled “Know your Coast”, Ray M. Thompson
A book “Gulf Coast Country” written by Hodding Carter and Anthony Ragusin.

These sources basically all have the same story, but no "facts"  The Houston Chronicle articles seem to contain the exact content of the Daily Herald article which in turn references the book.  Hmmmm....

Ok, every one indicates a lawsuit, dredging and oysters, well, the only place a suit between states would be decided was the Supreme Court, so, here is what I found.

U.S. Supreme Court
STATE OF LOUISIANA v. STATE OF MISSISSIPPI, 202 U.S. 1 (1906)
202 U.S. 1 STATE OF LOUISIANA, Complainant, v. STATE OF MISSISSIPPI. No. 11 , Original.
Argued October 10, 11, 12, 1905. Decided March 5, 1906.
U.S. Supreme Court
STATE OF LOUISIANA v. STATE OF MISSISSIPPI, 202 U.S. 58 (1906)
202 U.S. 58 STATE OF LOUISIANA, Complainant, v. STATE OF MISSISSIPPI.  No. 11 , Original.
April 23, 1906
U.S. Supreme Court
UNITED STATES v. LOUISIANA, 394 U.S. 11 (1969)
394 U.S. 11 UNITED STATES v. LOUISIANA ET AL. (LOUISIANA BOUNDARY CASE). ON CROSS-MOTIONS FOR THE ENTRY OF A SUPPLEMENTAL DECREE AS TO THE STATE OF LOUISIANA. No. 9, Orig.
Argued October 14-15, 1968. Decided March 3, 1969.

Well, all these involve the boundary, and some oyster stuff, and dredging, etc.  The only relevant one however seems to be the first one that is hyperlinked above.  Basically, it starts it all off and indicates in the text that that boundary line was there since "the treaty made at Paris on the 30th day of April, 1803 [8 Stat. at L. 200], between the United States and France".

In 2004, I was contacted by a gentleman who is from Mississippi, and his family has been there for generations.  He has the "Mississippi Version" of the story.  The story goes basically that the whole process came about somewhere around 1817 there was a dispute between LA and MS regarding who would own the Honey Island swamp.  Apparently no one wanted it due to the lack of use of the land, and the criminals that lurked in the swamp .  Somehow, during the time when Columbia was capitol of MS, it was decided to drop a barrel into the Pearl river, at the time, the east Pearl was the main channel.  Barrel went down the east Pearl, MS was happy at the time, and the rest is history.

Still researching this part.  It basically fits better, because it does coincide with the timeframe of what I found earlier.  Still no hard facts however, but I did come across the following passage from the Historical Text Archive.

"From 'Instances of the Use of United States Armed Forces Abroad, 1798-1945,' Hearing before the Committee on Foreign Relations and the Committee on Armed Services, 87th Congress, 2nd Session, Mon., Sept. 17, 1962.
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1810--West Florida (Spanish territory). Gov. Claiborne of Louisiana, on orders of the president, occupied with troops territory in dispute east of the Mississippi as far as the Pearl River, later the eastern boundary of Louisiana. He was authorized to seize as far east as the Perdido River. No armed clash."

Still no barrel references, more references indicating otherwise.   And I'm still not sure it has to do with the original story about the barrier islands.  This part seams to be more actual "land".   So, until I get something I can verify, I'll stick with my original assessment.  Nice story, just isn't true.  Checking the historic maps, I have a tendency to believe that all that land was once solid (or very broken marsh) and has eroded over hundreds of years.  Check out the historic maps link to check this for yourself.   And please, if you have other information, send it along to me (email, voice, snail-mail, etc).  I'm not that hard to find if you really want to.