Lawmakers Push Back on AI-Powered Toys for Kids

Lawmakers in Congress and state legislatures are moving to restrict or ban toys that use artificial intelligence, even as companies around the world race to put more of these products on shelves. U.S. Rep. Blake Moore (R-UT) introduced the AI Children's Toy Safety Act, which would ban the sale and manufacture of toys with built-in chatbots — the kind of technology that lets your toy talk back to you using AI, similar to how ChatGPT works.

At the state level, California's Steve Padilla introduced a bill that would pause sales of AI chatbot toys for four years. These moves come as hundreds of companies, particularly in China, are developing AI toys. Wired reports that over 1,500 AI toy companies registered in China by October 2025.

Companies are selling a lot of these toys

Despite the regulatory pushback, sales are brisk. Sharp released a talking AI toy in Japan in April 2026. Huawei's Smart HanHan plush toy sold 10,000 units in China in its first week. A company called Miko says it has sold more than 700,000 AI toy units worldwide.

Major toy makers like Mattel are jumping in. Mattel recently announced a partnership with OpenAI, the company behind ChatGPT. This suggests that traditional toy companies see AI as a permanent part of their future, not a fad.

These AI toys are sold for children as young as 2 years old. Most run on AI systems like ChatGPT, according to Associated Press reporting.

Federal agencies are getting involved

The Federal Trade Commission, which oversees consumer protection, has opened investigations. The FTC sent formal requests to seven companies to explain how they test and monitor the impact of their AI chatbots on children and teenagers.

The agency has already taken enforcement action against one toy maker. Apitor Technology faced legal action for collecting children's location data without getting parents' permission first — a violation of rules known as COPPA that protect children's privacy online.

The Consumer Product Safety Commission has also weighed in. The agency held a forum on artificial intelligence and smart toys in March 2021 and published a technical report on smart toys in October 2024.

Current safety testing for toys applies to products designed for children 12 and under. But the rules were written long before AI toys existed.

Toymakers are making changes

Under pressure from lawmakers and regulators, some companies are responding. Miko added an on-off switch so parents can disable the AI chatbot features in their toys. The company made this change after facing criticism and regulatory scrutiny.

But critics say this isn't enough. Senator Marsha Blackburn noted that Miko's changes came only after the company faced a security breach that exposed children's data. Miko's leadership has denied that they leaked user data or stored children's voice recordings.

The Toy Association, which represents toy manufacturers, is working to develop voluntary guidelines for how AI should be used in toys. The group plans to meet with members of Congress and administration officials in April and June 2026 to discuss AI toy issues.

The bigger picture

This regulatory focus on AI toys is part of a larger debate about artificial intelligence and children. But the timing is notable for another reason. Toy Story 5, coming to theaters in summer 2026, features an AI tablet device as the main villain — a storyline that may draw more public attention to the issues that lawmakers are concerned about.

We have seen similar patterns before in technology history. When smartphones became common in homes, regulators eventually cracked down on apps that collected children's data or showed inappropriate content — but only after millions of families had already adopted the technology. The current push against AI toys is different: lawmakers are acting while the market is still growing, not after it has become widespread.

Major child advocacy groups are urging parents to avoid these toys. Fairplay, a children's rights organization, published a holiday season advisory recommending against AI toy purchases, backed by more than 150 organizations and experts.

The stakes are significant. If lawmakers pass restrictive laws, major toy companies like Mattel will have to redesign their products and business plans. At the same time, companies in other countries — especially China — are continuing to develop and sell AI toys with few restrictions. This suggests the final outcome will shape whether AI toys end up regulated like other children's technology, or whether they face stricter limitations that fundamentally change the category.