In 1880, a German seamstress named Margarete Steiff, whose bout with polio had limited her to sewing with only one hand, founded the company that bears her name and is today the leader in stuffed, plush bears. Steiff’s nephew Richard created the first soft bear for his aunt, whose factory produced all sorts of toys at the time. Steiff's idea for the bear came from his drawings of the animals at the Stuttgart Zoo.

An American wholesaler named George Borgfeldt saw the bear at the Leipzig Toy Fair in 1903 and promptly ordered 3,000 of them. By World War I, Steiff had sold millions of these toys in the United States, Germany, and England. Steiff bears made after 1905 have a trademark Steiff button sewn into their ears.