The ubiquitous Christmas gift can be traced to President Theodore Roosevelt's 1902 bear-hunting trip in Mississippi. A former slave named Holt Collier was the president's guide:
Wanting to save the kill for the president but seeing that his dogs were in danger, Collier swung his rifle and smashed the bear in the skull. He then tied it to a nearby tree and waited for Roosevelt. When the president caught up with Collier, he came upon a horrific scene: a bloody, gasping bear tied to a tree, dead and injured dogs, a crowd of hunters shouting, “Let the president shoot the bear!” As Roosevelt entered the water, Collier told him, “Don’t shoot him while he’s tied.” But he refused to draw his gun, believing such a kill would be unsportsmanlike.
News of Roosevelt's gesture swept the nation and the Washington Post printed the above cartoon:
Back in Brooklyn, N.Y., Morris and Rose Michtom, a married Russian Jewish immigrant couple who had a penny store that sold candy and other items, followed the news of the president’s hunting trip. That night, Rose quickly formed a piece of plush velvet into the shape of a bear, sewed on some eyes, and the next morning, the Michtoms had “Teddy’s bear” displayed in their store window. … Teddy’s bear became so popular the Michtoms left the candy business and devoted themselves to the manufacture of stuffed bears.