The Inside Line on the Hottest Holiday Toys

Good luck finding this season's hottest toys.

Not only is this the shortest holiday shopping season in six years, with just 27 days between Thanksgiving and Christmas, but the dockworker strike in early fall has ensured that toys made in Asia will be harder to find than usual. And with retailers like Abercrombie & Fitch(ANF) concerned that consumers will spend less, inventory levels are being tightly controlled to prevent the wave of discounting that happened after last Christmas.

Consider what happened at the launch of the Silly Sounds Teletubbies dolls in the flagship Times Square Toys R Us. Even though the toy wasn't even advertised on TV, demand was so great that Toys R Us(TOY) couldn't keep them on the shelves. Parents and children mobbed the store display for weeks, eagerly grabbing the first Teletubbies toy released stateside in more than a year.

"Over the last three weeks, we've averaged 5,000 units a week," said Andrew Kerr, vice president of marketing for Ragdoll, which created the Teletubbies. "We expect to move 200,000 by the end of the year, but we have some concerns we won't be able to get all of the product on shelves that we'd like."

This puts parents under the gun. The key this year is figuring out the hot gifts and scooping them up early. You may not know the difference between Yu-Gi-Oh and Pokemon, but your kids do. But fear not: With our special inside look at this year's hottest toys, you'll get a jump on the competition, while ensuring that you grab the right toy.

The Toy that Toddlers Can't Put Down: Chicken Dance Elmo

Elmo, the fuzzy red Sesame Street character, has replaced Big Bird and Cookie Monster as the head Muppet in charge. Indeed, when the very first Elmo dolls were released more than five years ago, retailers couldn't keep them on the shelves. Dolls sold for hundreds on eBay. And this holiday season, Fisher Price will capitalize by releasing a new battery-powered plush Elmo that sings and dances like a chicken -- something that will keep 2-year-olds enthralled for hours. (Who can put a price tag on that?)