General :: Alt-d Alt-f Etc. Stops Working In Xterm?

Something weird sometimes happens on my Debian system. Typically at the prompt line I can use combo like alt-d to delete a word, alt-f to go to the next word, etc. But quite regularly something happens in my xterm that makes alt-d and alt-f not work anymore: suddenly they print 'ä' (alt-d) and 'æ' (alt-f).

Note that this happens in a terminal that was acting like I wanted to at first. But then somehow must send a code or something that changes the behavior of the terminal. It happens in xterm because that's where I always work. If I go to a console by doing ctrl+alt+f1 then by default alt-d does what I want (delete word) and so does alt-f. Maybe that I could screw that one too by doing some bad manipulation: I just don't know because I don't work in text mode.

Also note that if I spawn an xterm from the "broken" xterm, then the new xterm work as I expect. What is going on? What am I turning on that was off previously? My .Xresources says that and, once again, when I open an xterm it behaves as I expect it, it's only later on that "something" makes that it goes back to broken "I-print-characters-with-diacritics-and-other-nonsense" mode:

$ more .Xresources
XTerm.vt100.eightBitInput: false
XTerm*eightBitInput: False