The 1864 Indian cent with the L on the ribbon is one of the most famous U.S. cent varieties. The L is the designer's (James Longacre) initials. The 1859 to 1864 copper-nickel Indian cents did not have the designer's initials. And most of the 39,233,714 1864 bronze Indian cents also lack the initials. Towards the end of the year, the designer's initials were added to the ribbon on the obverse, creating a variety that has been very popular with collectors ever since. The designer's initials remain on the ribbon through the end of the series in 1909.
The 1864-L is scarce in circulated grades and very scarce in mint state. However, its price has as much to do with its popularity and importance to collectors as it does with its scarcity.
All 1864-L Indian cents have a pointed bust on Ms. Liberty, while the no Ls have a rounded bust. So sometimes low grades are designated (correctly) as Ls even if you can't really see the L. Most mint state specimens are Red and Brown and Full Red Gems are quite rare.