The penny has been in continuous existence for well over a thousand years, and for much of that time in a fairly consistently recognisable form, though the intrinsic value was often
debased for financial reasons. For most of its history the penny was a small
silver coin, typically with the king's head and name on one side, and a
cross and
mint details on the other. In
1797 the extraordinary '
cartwheels' were minted, huge
copper coins (as in the
penny-farthing bicycle) with the figure of
Britannia on the reverse, and these continued until
decimalisation in
1971. The penny is also the only
denomination that has been in continuous use from the beginning, and for many centuries it was the only
coin.
The earliest coinage in Britain was among local Celtic rulers, crude and mainly geometric, with the odd discernible horse or fragment of a ruler's name. Under the Romans, their usual superb standard applied: it's probably fair to say most modern coins are based on Roman models. Under the Anglo-Saxons the quality dropped to little better than Celtic style again, and continued that way, not reaching Roman quality until about 1500.
Anglo-Saxon coinage drew its inspiration from Merovingian France; from around 630 the local kings issued gold thrymsas based on Frankish tremisses, but by 675 steady debasement of the gold with silver had reduced the thrymsa to an entirely silver currency. They featured heads, geometric fillers, and some simple inscriptions. The pennies of this period are often called sceattas, literally 'treasure'. This was a reasonable collective name since this was the only kind of modern coin around. In 755 Pepin reformed the Frankish currency and issued good-quality deniers, named from the Roman denarii but physically derived from Islamic dinars. This explains the symbol 'd.' for the pre-decimal penny. On this model similar coins were introduced into England shortly after by Offa of Mercia and two obscure Kentish kings: Offa's first effort was a gold Arabic dinar with the overstruck inscription OFFA REX, but thereafter pennies were of silver, and larger than the old sceattas. Apart from the odd experiment with a gold penny or a silver halfpenny, this remained the situation throughout England.
Coins were issued by most of the Saxon kingdoms, and also by the Danelaw, the Welsh prince Hywel Dda, the Bishop of London, and the Archbishop of Canterbury. The Kingdom of Mercia actually used the mint at Canterbury, over in Kent, until 825. The coins tended to have legible inscriptions, usually included the name of the moneyer who made them, and often had the ruler's portrait or a cross.
Initially they had a weight of about 20 grains, or 1.3 grams, and under Alfred the Great this was raised to 24 grains, which is still called a pennyweight. But the real weight of the penny was undercut time and again as foreign wars called on reserves of money: to 20 grains in 1344, 18 grains in 1351, 15 grains in 1412, and 12 grains in 1464.
King Edgar, the first king indisputably ruling over all of England, issued a new, unified currency in 973. The obverse had the king's portrait and name, while the reverse had a small cross, with the moneyer's name and that of the mint town. This remained the sole pattern for hundreds of years, with no more halfpence or any others, unchanged past 1066. Originally many, many towns and lords had mints, though they were under central control, but in the 12th and 13th century they were drastically reduced until out of some seventy there were now only mints at London and Canterbury.
Halfpence and farthings had been created by cutting pennies, until a halfpenny was minted in 1106 and a farthing in 1216. These were both silver like the penny. Base metal didn't come in for a long time afterwards: under Henry VIII the silver was heavily debased with copper. Under Edward VI base metal was used for nominal pennies and halfpennies, side by side with silver ones, but these were not trusted, and were accepted at only half their value. Copper farthings were issued under private licence in 1613, and tin farthings and halfpennies under William and Mary. Only in 1797 did the penny itself turn officially to copper.
This is not the place to go into detail, but the first higher-denomination coin was the gold penny of 1257, equal to 20 silver pence. This was shortlived and was followed by the groat or fourpenny in 1279, weighing 89 grains. The first sign of superior coinage harking back to classical models was the gold series of 1344, with the florin of 6 shillings, the leopard of 3 shillings, and the helm of 1s. 6d., or 18 pence. These were replaced later that year by the noble of 80 pence, and half and quarter nobles, and this system continued a long time, with others added occasionally. The shilling and pound of the familiar £.s.d. system that lasted till 1971 were units of account at this time but not issued as coins: the magnificent gold pound or sovereign was finally issued by Henry VII in 1489, and the shilling a little after that. Read decimalisation and British Currency, Pre-Decimalisation for more.
With the union of the crowns in 1603 under King James VI and I this was symbolised by pennies featuring the rose of England on one side and the thistle of Scotland on the other. Under the Commonwealth the shields of the countries were used, and after the Restoration, when the king's head returned to the obverse, the reverse was now largely occupied by a figure, since they began to issue 1d, 2d, 3d, and 4d coins. It was this system that was replaced by the very large Britannia designs for 1d and (formerly) 2d, which continued in existence into our own time.
The Spink coin company's catalogue Coins of England.