The 1821 Small Date Dime resulted from an interesting slip-up at the Mint. Instead of using the normal date punch for a Dime, the engraver picked up the date punch for a Quarter Eagle (the smallest-sized coin made in 1821). The result is an 1821 Dime with a date that is much smaller than normal, and which has a flat-base 2 instead of the usual curl-base. Surprisingly, three different obverse dies (out of eight) were made with the small date, resulting in three die varieties (LM-8, LM-9, and LM-10).
The Small Date version of the 1821 Dime is considerably scarcer than the Large Date. According to the PCGS Population Report (as of October 2011), PCGS had certified 62 Small Dates compared to 246 Large Dates. Among the Small Dates, 12 are Mint State and they range in grade from MS-62 to a single Gem in MS-66.
Sources and/or recommended reading:
David J. David et al. Early United States Dime 1796-1837 (Ypsilanti, MI: John Reich Collectors Society, 1984).