Directional words (north, east, south, west, and their compounds) prefer the lowercase unless used as proper nouns. Do not capitalize when indicating a direction: He went north, It’s southeast from Quebec.
Capitalize directional words when they belong to proper names: Pacific Northwest, East Germany, Chicago’s South Side, Northern Ireland. Do not capitalize when the terms refer to a general area: eastern United States, south Vermont. While some locations may be easy to judge due to popular usage (Southeast Asia) or a distinct border (West Germany), other locations may require familiarity with the region (Southern California) and should be capitalized following style guides or dictionaries.
For regional people, use the lowercase unless their titles refer to specific social, political, or economic group: southerner (of a country), Southerner (a specific group of political rebels in American Civil War contexts). The American North–South divide may lead to debate with terms like southern hospitality, southern gentry, southern rock, etc., but since none of these refer to specific titles, they should not be capitalized. Some style guides, magazines, and regions may disagree; prefer that which gets you in the least trouble.
When indicating a general direction, American English adds the -ward suffix for both adjectives and adverbs: forward, eastward, outward. British English allows -wards for adverbs only.
For -ly endings, use the proper spelling: northerly, easterly, southerly, westerly.