The answer lies in separating the noun (coast or coastal) from the prefix (inter or intra.)
In English, a prefix is added to the beginning of a word to modify its meaning. Intra- is a prefix signifying inside, within, interior, during. Inter- is a prefix signifying among, between, amid, during, within, mutual, reciprocal.
Therefore, an "Intracoastal waterway" can be said to be an "inside-the-coast" or "within-the-coast" waterway. An "Intercoastal waterway" would be an "among-the-coast(s)" or "between-the-coast(s)" waterway.
More to the point; the Atlantic Intracoastal Waterway is a protected waterway totally within the coast of the United States. The fact that it also lies in, between and among several states (Interstate in other words) is unrelated to to the fact that it is within the coast. The confusion arises due to the extensive, and commonly called, "Interstate" highway system in the United States which runs among and between the several states.
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