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The first toy trains were made from lead and had no moving parts. Some had wheels which flipped, but these had to be pushed or pulled. A few of the early 19th-century drive toy rails were made from tinplate, such as the big, durable, stylized locomotive toys from the U.S., which were painted gold and red and decorated with hearts and flowers. model trains hobby lobby

Around 1875, technological improvements in materials and manufacturing allowed tin to be scraped, cut, rolled, and lithographed faster than previously.
Toy trains were revolutionized when Märklin, a German firm which specialized in doll house accessories, sought to make an equivalent toy for boys in which a constant revenue stream could be guaranteed by purchasing add-on accessories for years after the first purchase. Along with boxed sets containing a train and track, Märklin offered extra track, rolling stock, and buildings sold separately, creating the predecessor to the modern model train layout featuring buildings and scenery along with a working train.

Electric trains adopted, with the first appearing in 1897, made from the U.S. firm Carlisle & Finch. As home use of power became more common from the early 20th century, electric trains gained popularity and as time moved on, these electrical trains grew in sophistication, gaining lighting, the ability to change direction, to emit a whistling sound, to smoke, to couple and uncouple cars as well as load and unload freight. Toy trains by the first half of the 20th century were frequently made of lithographed tin; later trains were frequently made mostly of plastic.
Pull toys and wind-up trains were marketed by children, while electric trains were marketed towards teenagers, particularly teenaged boys. It was during the 1950s the modern emphasis on realism in model railroading began to catch on.

Now, S gauge and O gauge railroads continue to be considered toy trains even by their own adherents and are often accessorized with semi-scale model buildings by Plasticville or even K-Line (who owns the rights to the Plasticville-like buildings created by Marx in the 1950s into the 1970s). However, due to their high price, one is more likely to find an HO scale or N scale train set in a toy store than an O scale set.

Many modern electrical toy trains contain sophisticated electronic equipment that emit digitized sound effects and permit the operator to safely and easily run multiple remote controller trains on one loop of course. In the last few years, many toy train operators will operate a train with a TV camera in the front part of the motor and hooked up to a display, such as computer monitor. This will show a picture, similar to that of a genuine (smaller size) railroad.

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