Even thought it's not her only dagger, Xena uses it a few times during the series and gives fans the proud moment of saying "OOH! That's the Breast Dagger!"
The Breast Dagger's most impressive moment was when Xena was tied up. She took a deep breath and shot the dagger out from between her breasts, and cut the ropes.
Later on Xena just put it in normal dagger places, maybe remembering she only has armor on the outside of her boobs.
Series 3: Intimate Strangers - Callisto as Xena attaches the dagger to the end of Gabrielle's staff so she can use it to kill Xena in Callisto's body.