I was really confused learning this because "Östersjön" translated to Estonian is like the opposite. It can be roughly translated to "Västersjön" (also there is an actual lake in Sweden by that name apparently). It is due to the fact that Estonia is "on the other side" of The Baltic Sea.
I was guessing that "Östersjön" referred to just what we (in U.S.A.) identify as "The Gulf of Bothnia" (The part of the Baltic between Sweden and Finland"), but as it wasn't accepted (and looking at the discussion on this topic) I am now assuming that it refers to the entire Baltic. Is this correct?