The Collaborative International Dictionary of English v.0.48:

Squatter \Squat"ter\ (-t[~e]r), n.
   1. One who squats; specifically, one who settles unlawfully
      upon land without a title. In the United States and
      Australia the term is sometimes applied also to a person
      who settles lawfully upon government land under legal
      permission and restrictions, before acquiring title.
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            In such a tract, squatters and trespassers were
            tolerated to an extent now unknown.   --Macaulay.
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   2. (Zool.) See Squat snipe, under Squat.
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   Squatter sovereignty, the right claimed by the squatters,
      or actual residents, of a Territory of the United States
      to make their own laws. [Local, U.S.] --Bartlett.
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