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

Around 1875, technological improvements in materials and manufacturing allowed tin to be stamped, cut, wrapped, and lithographed faster than previously.
Toy trains were altered when Märklina German company that specialized in doll house accessories, sought to create an equal toy for boys where a constant revenue stream could be ensured by purchasing add-on accessories for decades after the first purchase. Along with boxed sets comprising a train and track, Märklin offered additional track, rolling stock, and buildings sold separately, creating the predecessor to the modern model train layout featuring scenery and buildings in addition to a working train.

Electric trains adopted, with the first appearing in 1897, produced from the U.S. firm Carlisle & Finch. As home use of electricity became more prevalent in the early 20th century, electric trains gained popularity and as time moved on, these electric trains grew in sophistication, gaining light, the ability to change management, to emit a whistling sound, to smoke, to couple and uncouple cars and even load and unload freight. Toy trains by the first half of the 20th century were frequently made of lithographed tin; afterwards trains were frequently made mainly of plastic.
Prior to the 1950s, there was little differentiation between toy trains and model railroads–model railroads were toys by definition. Pull toys and wind-up trains were marketed by kids, while electrical trains were marketed towards teenagers, especially teenaged boys.
Consumer interest in trains as toys waned in the late 1950s, but has experienced resurgence since the late 1990s due in large part to the popularity of Thomas the Tank Engine.

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

Many modern electric toy trains contain sophisticated electronics which exude digitized sound effects and permit the operator to safely and easily run multiple remote control trains on one loop of track. In recent years, many toy rail operators may operate a train using a TV camera in the front part of the engine and hooked up to a screen, such as computer monitor. This will show a picture, like that of a real (smaller size) railroad.

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