The History of Action Figure

1960s–1970s

The term "action figure" was first coined by Hasbro in 1964, to market their G.I. Joe figure to boys who wouldn't play with dolls (A similar toy named Johnny Hero was introduced by Rosko Industries for Sears in 1965, but was known as a "Boy's Doll" since the term action figure had not gained widespread usage at that point.). G.I. Joe was initially a military-themed 11.5-inch figure proposed by marketing and toy idea-man Stan Weston. It featured changeable clothes with various uniforms to suit different purposes.
In a move that would create global popularity for this type of toy, Hasbro also licensed the product to companies in other markets. These different licensees had a combination of uniforms and accessories that were usually identical to the ones manufactured for the US market by Hasbro, along with some sets that were unique to the local market. The Japanese had at least two examples where a Hasbro licensee also issued sublicenses for related products. For example, Palitoy (in the UK) issued a sublicense to Tsukuda, a company in Japan, to manufacture and sell Palitoy's Action Man accessories in the Japanese market. Takara also issued a sublicense to Medicom for the manufacture of action figures.
Takara, still under license by Hasbro to make and sell G.I. Joe toys in Japan, also manufactured an action figure incorporating the licensed GI Joe torso for Henshin Cyborg-1, using transparent plastic revealing cyborg innards, and a chrome head and cyborg feet. During the oil supply crisis of the 1970s, like many other manufacturers of action figures, Takara was struggling with the costs associated with making the large 11 ½ inch figures, So, a smaller version of the cyborg toy was developed, standing at 3-3/4 inches high, and was first sold in 1974 as Microman. The Microman line was also novel in its use of interchangeable parts. This laid the foundation for both the smaller action figure size and the transforming robot toy. Takara began producing characters in the Microman line with increasingly robotic features, including Robotman, a 12" robot with room for a Microman pilot, and Mini-Robotman, a 3-3/4" version of Robotman. These toys also featured interchangeable parts, with emphasis placed on the transformation and combination of the characters.
In 1971, Mego began licensing and making American Marvel and DC comic book superhero figures, which had highly successful sales and are considered highly collectible by many adults today. They eventually brought the Microman toy line to the United States as the Micronauts, but Mego eventually lost control of the market after losing the license to produce Star Wars toys to Kenner in 1976. The widespread success of Kenner's Star Wars 3-3/4" toy line made the newer, smaller size the industry standard. Instead of a single character with outfits that changed for different applications, toy lines included teams of characters with special functions. Led by Star Wars-themed sales, collectible action figures quickly became a multi-million dollar secondary business for movie studios.
From 1972 to 1986 there was a famous line of Big Jim action figures produced by Mattel.

1980s–1990s

The 1980s spawned all sorts of popular action figure lines, many based on cartoon series', which were one of the largest marketing tools for toy companies. Some of the most successful to come about were Masters of the Universe, G.I. Joe, Thundercats, and Super Powers Collection, to name just a few. Early in the decade, the burgeoning popularity of Japanese robot anime such as Gundam also encouraged Takara to reinvent the Microman line as the Micro Robots, moving from the cyborg action figure concept to the concept of the living robot. This led to the Micro Change line of toys: objects that could "transform" into robots. In 1984, Hasbro licensed Micro Change and another Takara line, the Diaclone transforming cars, and combined them in the US as the Transformers, spawning a still-continuing family of animated cartoons.
As the '80s were ending, more and more collectors started to surface, buying up the toys to keep in their original packaging for display purposes and for future collectability. This led to flooding of the action figure toy market. One of the most popular action figure lines of the late '80s and early '90s, Teenage Mutant Ninja Turtles action figures were produced in such high quantities that the value for most figures would never be higher than a few dollars. In the mid-1990s, a new Star Wars figure line had surfaced and Spawn figures flooded the toy store shelves, proving action figures were not just for kids anymore. Beginning in 1997, ToyFare magazine would become a popular read for mature collectors in providing news and embracing nostalgia with a comedic twist. And with the gaining popularity of the Internet, websites such as Toy News International would soon offer information on upcoming collectible figures and merchandise.
It was during this time that popular characters were increasingly getting specialized costume and variant figures. Batman quickly became most notorious for this (i.e. Arctic Batman, Piranha Blade Batman, Neon Armor Batman). Rather than individual characters, these variants would make up the bulk of many action figure lines and often make use of the old figure and accessory molds. Glow-in-the-dark figures and accessories also became popular in the early '90s with lines like Toxic Crusaders and Swamp Thing.
A 1999 study found that "the figures have grown much more muscular over time, with many contemporary figures far exceeding the muscularity of even the largest human bodybuilders" and that the changing cultural expectations reflected by those changes may contribute to body image disorders in both sexes.

2000s

Today, the adult collector market for action figures is expanding with companies like McFarlane Toys, Palisades, and NECA. Said companies have given numerous movie characters, musicians, and athletes their very first highly detailed figures. These are commonly intended as statuesque display pieces rather than toys; however, child-oriented lines such as the Masters of the Universe revival and Justice League Unlimited still evoke adult collector followings as well. Comic book firms are also able to get figures of their characters produced, regardless of whether or not they appeared in movies or animated cartoons. Examples of companies that produce comic figures and merchandise almost exclusively include Toy Biz and DC Direct.
Adult-oriented figure lines are often exclusive to specific chain stores rather than mass retail. Popular lines often have figures available exclusively through mail-in offers and comic conventions, which raises their value significantly. Ploys such as packaging "errors" and "short-packed" figures have also been used by toy companies to increase collector interest.