Oswald was a character the Disney Studios created 
after Alice Comedies had run its course. 
The rabbit starred in a series of 
    26 animated black & white silent shorts (that were 
shown in major theaters with first-run movies) 
between 1927 and 1928. He also was the first Disney character to generate merchandise: a chocolate-covered marshmallow candy bar, a stencil set, and a pin-backed button.
    The idea for this character came about when Disney's film distributor Charles Mintz (who was now married to Alice distributor Margaret Winkler) suggested a change in direction to keep his animated shorts fresh. Universal Studios was looking for a cartoon series featuring a rabbit and Mintz/Winkler suggested Walt Disney.
    Oswald - created by Ub Iwerks and Walt - was a spunky & mischievous character with a personality and look that would later be reminiscent of a certain famous mouse. (In fact it's been said that Mickey Mouse is Oswald with round ears.) 
The first Oswald cartoon Trolley Troubles, was released September 5, 1927. Oswald's clever gestures and amusing gags made him a favorite with moviegoers over the next 17 months.
    Disney, constantly striving for a higher quality, began producing Oswald cartoons that were costly. In February 1928 Walt traveled to New York to speak with Mintz about an increase in pay. To Walt's surprise, Mintz wanted to cut his pay by some 20%! In addition, he learned that Mintz controlled the rights to Oswald. Rather than accept the cut, Walt gave up his creation, making Mintz the first of many who believed they could assume Disney's success. 
(Mintz and Winkler eventually lost the character as well and Walter Lantz went on to animate Oswald well into the 1930s.
Ironically Oswald would return to Disney in February 2006!)
    Walt learned from this loss and went on to create another successful character ... that no one would ever be able 
to take away.
Mickey's Predecessor

Trace Walt's 1928 NY trip:  FEB 06   MAR 01   MAR 02   MAR 03   MAR 05   MAR 08   MAR 13   MAR 18
Oswald in Modern Times
Oswald became a true Disney character in 2006 when he was among the assets the company 
acquired from NBC Universal in a deal that let sportscaster Al Michaels leave ABC and ESPN 
and sign with NBC. Disney also secured the rights to the 26 vintage Oswald cartoons made by 
Walt. Those Oswald shorts were released on a special two-disc DVD, and Oswald merchandise 
began hitting stores and the Internet in late 2007.
In Disney's 2010 video game Epic Mickey, Oswald is front and center in a story where he is 
presented as the head of Wasteland, a bizarre version of Disneyland.