Polly Pocket is a line of dolls and accessories created by Bluebird Toys and was first designed by Chris Wiggs in 1983 for his daughter Kate. Using a powder compact, Chris fashioned a small house for the tiny doll. Bluebird Toys of Swindon, England, licensed the concept and the first Polly Pocket toys appeared in stores in 1989. Mattel held a distribution arrangement with Bluebird Toys for Polly Pocket items in the early 1990s. In 1998, while production lulled, Bluebird Toys endured multiple hostile takeover attempts until Mattel finally purchased them later that year. The sets made by Bluebird Toys are now valuable collectibles.
In 1998, Mattel redesigned Polly Pocket. The new doll was larger, with a more lifelike appearance than the original dolls. She had a straight ponytail, rather than the curly bob hairstyle used previously. The following year, Mattel also introduced "Fashion Polly!," which used the same characters from the new Polly Pocket (Lea, Lila, Shani, Polly, etc.), but they came in the form of 3.75 inches (9.5 cm) plastic jointed dolls. They gave a new spin on fashion dolls; instead of traditional cloth clothing, Polly Pockets used unique "Polly Stretch" garments, rubbery plastic clothes that could be put on the dolls and removed, made by Genie Toys. There are also some boy dolls.
In 2012, Polly Pocket toys were discontinued in the US, but remained available in Europe and South America. The brand dwindled, eventually only being sold in Brazil. By 2015, Polly Pocket was completely discontinued by Mattel in North America.
Source and more info: Wikipedia.