The Action Man figure and accessories was originally based on the Hasbro (US) 1964 G.I. Joe figure. Hasbro's GI Joe figure was patented in 1966, right down to the specific method of attaching the appendages, known as a "Connection for use in toy figures”.

The first Action Man figures were Action Soldier, Action Sailor and Action Pilot. All 4 models were available in hair colours, blonde, auburn, brown and black. They were accompanied by outfits based on the uniforms from the Second World War.

In the early years Action Man competed with the entirely British, “Tommy Gunn” by Pedigree Toys (who also made the Sindy doll). The Tommy Gunn figure copied aspects of Hasbro's G.I. Joe, released two years earlier in the United States.

Tommy Gunn was generally considered better quality in terms of equipment and accuracy of accessories, especially since the Action Man of the sixties was little more than a re-packaged G.I. Joe. However, he was ultimately unable to compete with Action Man and was discontinued in 1968.

Action Man was developed with British themes from 1970 on, with military, adventurers, and sportsman in the range, as Palitoy wanted to distinguish their product line from the U.S. counterpart.

Bill Pugh was the head of Action Man's product development at Palitoy, and can be credited with the development of innovations including, the flocked hair, gripping hands, and later "Eagle Eyes" which all crossed over to the GI Joe line, and by extension to that of other Hasbro licensees.

One series that truly set Palitoy's line apart from Hasbro's was the "Ceremonials". Although Hasbro had a set of Cadet ceremonial outfits, they did not match the scope and range of the British versions, which also included a horse of the Life Guards with full ceremonial regalia as an optional set.

The non-military was also covered with adventurous elements such as mountain rescue, Arctic exploration, scuba and deep sea diving. One outfit was only available through the Action Man stars scheme; the Royal Canadian Mounted Police (and accompanying mastiff dog).