This family business began in the 1870's when two brothers, George and Joseph Lines, formed G. & J. Lines Ltd. They primarily focused on wooden toys, until after the war when George's three sons, William, Arthur and Walter decided to open their own company, Lines Bros. Ltd. In 1931, Line Bros. Ltd registered a range of prams it was producing under the trademark Pedigree. Six years later, in 1937, they launched their first catalogue of Pedigree soft toys, in which teddy bears featured, and soon they were producing soft toys in factories around the world.

Pedigree teddy bears were very competitively priced compared to their competitors, which was very important during the 1930's and 40's. This is mainly what led Pedigree teddy bears to become remarkably successful and the Merton factory, in south-west London, made Lines Bros. Ltd the largest toy factory in the world.