Garden statuary has been common in Europe at least since the Renaissance. Among the figures depicted were gobbi (Italian for dwarfs or hunchbacks). In particular, Jacques Callot produced 21 designs for gobbi, engraved and printed in 1616. By the late 18th century, porcelain “House Dwarfs” had begun to be produced, and they remained popular ornaments throughout the 19th Century. In addition, wooden statues of gnomes had been made in Switzerland, around the town of Brienz. Even so, the claim to be the manufacturer of the first garden gnome is hotly contested, but it is possible that Baehr and Maresch of Dresden produced the first ceramic gnomes, having them in stock as early as 1841.
The very first German garden gnome (Gartenzwerg) was made of clay in Graeferoda, Thuringia, Germany in the 1800's by potter Philip Griebel who was a sculptor of terracotta animals. These first garden gnomes were moulded from terracotta clay, dried, fired in a kiln and finally painted.
The first recorded apperance of a garden gnome in England was around 1840 at the estate of Sir Charles Isham, the 10th Baronet of Lamport Hall when he brought twenty one terracotta gnomes back from his travels in Germany. Only one of these twenty one original gnomes survives today, known as "Lampy" this gnome is still kept on display and is insured for one million pounds.
The first two individuals to produce gnomes in quantity were Philip Griebel and August Heissner around 1872, with Heissner Gnomes being the most well know throughout the world.