Toy Vault was founded in 1998 to fill a need in the marketplace for high quality well crafted toys and figures based on overlooked properties, such as The Lord Of The Rings.

The Gandalf and Balrog action figures were released in 1997. In 1999, the company produced action figures of Gollum, Gimli, Frodo, and Uglúk. In 2000, Toy Vault produced action figures of the Lord Of The Nazgûl, Barrow wight and Galadriel. Toy Vault lost the license to The Lord of the Rings when ToyBiz began making toys based on the New Line Cinema movie license.