Using Russian Dymkovo clay toys (collected by Walter Benjamin) as an example, we trace the history of one of the artistic crafts in the pre-industrial, industrial Soviet, and post-Soviet period in Russia. This history allows us to show how industrial society, mass culture, and the global market create conditions for the invention of local traditions and local creative industries. In the Soviet context, even Maxim Gorkij, a leading ideologist of Soviet art of the 1930s, was a proponent of the industrial toy ideology, which was directed against artisanal production, and specifically against Dymkovo toys. However, despite all these negative factors, trade in Dymkovo toys survived and expanded during the Soviet industrial period. The case of Dymkovo toys also denies Benjamin's classic thesis of "mechanical reproduction" as the inevitable fate of art and crafts in the mass industrial society of modernity.