Ron Guth: Mint engravers updated the design of the Half Dime in 1838 by adding stars to the obverse. By doing so, they matched the design with every other Seated Liberty design then in circulation with the exception of the Silver Dollar (which did not appear until 1840). Two major varieties appear in this year: the Large Stars and Small Stars. There is a marked difference in the sizes of the stars on the two varieties, and they can be seen best when the two varieties are laid side-by-side. Otherwise, an attribution guide, such as the images above, will be helpful. It is important to know the difference because the Small Stars is quite scarce in comparison to the Large Stars.
The 1838 Large Stars No Drapery Half Dime is fairly common, including in Mint State grades, where hundreds of examples have been certified. The best example certified by PCGS is an amazingly colorful PCGS MS68, one of the finest early Seated Liberty Half Dimes of any date.