An Indian penny refers to any of the one cent coins which were minted in the United States between 1859 and 1909. These coins bear the likeness of the head of the Statue of Liberty wearing a feathered headdress. Because the headdress resembled those traditionally worn in Native American cultures, the coin became known as the Indian penny or Indian head cent. James Barton Longacre is credited with coming up with the design for the coin, while he was employed as the engraver at the Philadelphia mint. About 1.85 billion Indian pennies were minted throughout its 50-year lifespan.
Despite the large number of these coins that were originally minted, relatively few survive. Because of this, all Indian pennies are worth at least $1 US Dollar (USD), as long as the date can be read, as well as the mintmark if there is one. Coin values, in general, are based on a combination of the rarity of the specimen and its condition. Of course, this is the case with most collectibles, but coin conditions are measured based on a standardized scale denoted by letters and numbers. A coin in perfect condition, denoted as MS-65, is the most desirable, but other coins in less pristine condition, such as VG-8 or G-4, can still be valuable, as is the case with the Indian penny.
The most valuable type of Indian penny is the 1877 issue. Whatever the reason at the time, very few 1877 Indian pennies were minted -- fewer than one million, in fact. This scarcity, and the fact that very few 1877 pennies have been kept in good condition, gives the coin what is by far the highest value of any Indian penny. An 1877 penny in Very Good or VG-8 condition can be sold for over $400 USD.
For the fist five years of the Indian penny series, the coins were made up of 88% copper and 12% nickel. It is a little-known fact that this coin was actually known as a "nickel" because of its nickel content. This was in the time before the issue of the five cent coin we know today as the nickel. In 1864, the alloy mixture was changed to 95% copper, with the remaining 5% composed of tin and zinc. This effectively reduced the coin's weight by more than a third. This alloy was used for many years thereafter but was also later abandoned in favor of copper-plated zinc in 1982.