The tooth fairy is a folkloric figure of early childhood in Western and Western-influenced cultures. The folklore states that when children lose one of their baby teeth, they should place it underneath their pillow or on their bedside table; the Tooth Fairy will visit while they sleep, replacing the lost tooth with a small payment.

During the Middle Ages, other superstitions arose surrounding children's teeth. Children in England were instructed to burn their baby teeth, on pain of spending eternity searching for the baby teeth in the afterlife. Fear of witches was another reason to bury or burn teeth. In medieval Europe, it was thought that a witch could assume total power over someone if they were to obtain one of their teeth.

One modern incarnation of these traditions into an actual Tooth Fairy has been traced to a 1908 "Household Hints" item in the Chicago Daily Tribune:

Tooth Fairy. Many a refractory child will allow a loose tooth to be removed if he knows about the Tooth Fairy. If he takes his little tooth and puts it under the pillow when he goes to bed the Tooth Fairy will come in the night and take it away, and in its place will leave some little gift. It is a nice plan for mothers to visit the 5-cent counter and lay in a supply of articles to be used on such occasions.

— Lillian Brown, Tooth Fairy, Chicago Daily Tribune

Unlike Santa Claus and, to a lesser extent, the Easter Bunny, there are few details of the Tooth Fairy's appearance that are consistent in various versions of the myth. A 1984 study conducted by Rosemary Wells revealed that most -- 74% of those surveyed -- believed the Tooth Fairy to be female, while 12% believed the Tooth Fairy to be neither male nor female, and 8% believed the Tooth Fairy could be either male or female. When asked about her findings regarding the Tooth Fairy's appearance, Wells explained: "You've got your basic Tinkerbell-type Tooth Fairy with the wings, wand, a little older and whatnot. Then you have some people who think of the tooth fairy as a man, a bunny rabbit, or a mouse." One review of published children's books and popular artwork found the Tooth Fairy to be depicted in many various forms, including as a child with wings, a pixie, a dragon, a blue mother-figure, a flying ballerina, two little older men, a dental hygienist, occasionally a female dentist, a potbellied flying man smoking a cigar, a bat, a bear, and others. Unlike the well-established imagining of Santa Claus, differences in renderings of the Tooth Fairy are not as upsetting to children.

Starting in 2011, the Royal Canadian Mint began selling special sets for newborn babies, birthdays, wedding anniversaries, "O Canada", and the Tooth Fairy. The Tooth Fairy quarters, which were issued only in 2011 and 2012, were packaged separately.

In 2020, the Royal Australian Mint began issuing "Tooth Fairy kits" that included commemorative $2 coins.