Troll dolls were popularized in 1959 by Danish fisherman and woodcutter, Thomas Dam. He didn't have the money to buy his daughter a birthday present and instead carved a troll out of wood. When the doll was shown to children in the town, they loved it and asked him to make them one. Their invention may have actually happened slightly earlier than 1959 though, because I have seen other reports that the first factory was opened in 1959. And, although there may have been a troll doll that beat Dam to the market, his was the most popular and widespread.
In the early 1960s, Thomas Dam and his family grew out of the back building where they were making trolls and started producing them from natural rubber in a factory. The troll dolls became so popular that three factories had to produce the dolls, and they started making the troll doll out of plastic instead of rubber. In the 1960s, the competitor to the troll doll was Barbie. And many enjoyed the creepy but adorable and funny troll dolls much more.
In the 1970s and 1980s, competitors flooded the United States market because of a judge ruled them in the public domain due to an error in its U.S. copyright notice. It wasn't until the 1990s that Congress would return copyright protection for troll dolls to Thomas Dam.
It was in the early 1990s that the troll dolls would experience there second major surge in popularity. Suddenly, it seemed that troll dolls, troll stickers, and troll doll pencil toppers were everywhere again, for a short time. But the fad was essentially over by 1992.
In 2003, the Toy Industry Association named the troll doll as one of the toys of the century. Subsequently, there have been efforts to return the troll doll to the forefront of American culture since, but none have been successful ... yet! We will see how the animated film in the works from Dreamworks does before deciding whether peak popularity has already happened.