Toy trains were revolutionized when Märklin, a German company that specialized in doll house accessories, sought to make an equal toy for boys where a constant revenue stream could be ensured by selling add-on accessories for decades after the initial purchase. Along with boxed sets containing a train and monitor, Märklin offered extra track, rolling stock, and buildings sold separately, creating the predecessor to the modern model train layout featuring scenery and buildings along with a working train.
Electric trains followed, with the first appearing in 1897, produced by the U.S. company Carlisle &amp; Finch. As home use of power became more common in the early 20th century, electrical trains gained popularity and as time moved on, these electrical trains grew in sophistication, gaining light, the ability to change direction, to emit a whistling noise, 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 often made mostly of plastic.
Pull toys and wind-up trains were marketed by children, while electric trains were marketed towards teenagers, particularly teenaged boys.
Today, S gauge and O gauge railroads are still considered toy trains by their own adherents and are often accessorized with semi-scale model buildings by Plasticville or K-Line (who owns the rights to the Plasticville-like buildings produced by Marx from the 1950s to the 1970s). However, due to their high cost, 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 comprise sophisticated electronic equipment that emit digitized sound effects and permit the operator to safely and easily run multiple remote control trains on one loop of course. In recent decades, many toy train operators will operate a train using a TV camera in the front of the engine and hooked up to a display, such as computer monitor. This will show a picture, similar to that of a real (smaller size) railroad.