Dithering is a mathematical process where a random noise is added to the least significant bit of a digital word. With very low level signals, the quantization error becomes correlated to the signal level. This creates a measurable amount of distortion. By adding dither, the correlation between the signal level and the quantization error is canceled, allowing the digital system to encode amplitudes smaller than the least significant bit. If you change the word size as a signal passes from one digital system to another, being able to add dither allows you to maintain a high quality signal.