The tradition of Mardi Gras came to the U.S. from Europe (likely France or Spain) and was enthusiastically adopted in New Orleans, which continues to be the hub of the celebration. The significance of the figurine in the cake as baby Jesus is widely accepted. However, New Orleans lore traces the doll-in-cake to hiding a bean or ring in the elaborate festive cake during the King’s ball celebrations in colonial Lousiana during the 19th century.
Whoever found the prize hidden in the cake was crowned King or Queen of the ball, which would take place in the days leading up to Mardi Gras. According to some historians, the practice was started by a New Orleans social group, the Twelfth Night Revelers, who hosted the season’s first ball. The switch from bean and ring to baby figurines occurred around the mid-1900s, according to New Orleans food expert Poppy Tooker (via NPR).
While King Cakes were traditionally homemade cakes eaten with the family, the burgeoning popularity of Mardi Gras celebrations led to more and more revelers turning to commercial bakeries for their cakes. A traveling salesman with a surplus of French porcelain figurines approached the owner of McKenzie’s, a popular bakery, with the idea of baking the tiny dolls into cakes. It worked, and once the French figurines ran out, the baker resorted to sourcing baby figurines from the city’s French Quarter, starting the Mardi Gras trend we all know today.