English uses both forms, Rumanian and Romanian, to denote the Romance-speaking population in the South-Eastern Europe north of the Danube, which was traditionally referred as Vlachs (or Wallachians). Both forms were adopted by the mid 19th century when the principalities of Wallachia and Moldova were unified to form a new state, Rumania or Romania. The forms Rumania and Rumanian were prevailing till the second half of the 20th century, when the forms with "o" gradually became more popular.
See also Wallachians, Walloons, Welschen etc.
It seems that the forms with "u" are etymologically justified, as Rumanian normally changes the unstressed (Vulgar) Latin "o" to "u", cf.:
The form with "o" was introduced in Rumania to stress the descendency of the Rumanians from the ancient Romans; this orthographic change happened by the time of the unification of the principalities of Wallachia and Moldavia in the unitary kingdom of Rumania. In this period Cyrillic script was replaced by Latin and the language was heavily re-latinized.
The Rumanian state since then always promote the spelling with "o", even in the foreign languages, and finally English also accepted it as official. Italian also changed the orthography, from "Rumania" to "Romenia"; modern Portuguese also uses the forms Romenia and Romeno.
On Orbis Latinus the forms with "u" are preferred in order to distinguish Rumania, the modern state, from Romania, the historical name of the Roman empire, which is used now by the linguists to denote all the countries where Romance languages are spoken. These preferences are only technical and are based on the established practices of English. The usage of the forms Rumania and Rumanian are in no way attended to offend the modern state and nation which have preserved through centuries the Roman name.
See also Rome,
Romania and Rumania.
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Zdravko Batzarov