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Fiji mermaid and Tom Thumb

In 1842, Barnum introduced his first major hoax: a creature with the body of a monkey and the tail of a fish known as the "Feejee" mermaid. He leased it from fellow museum owner Moses Kimball of Boston who became his friend, confidant and collaborator. Barnum justified his hoaxes by calling them advertisements to draw attention to the museum. He said, "I don't believe in duping the public, but I believe in first attracting and then pleasing them."

He followed the mermaid act by exhibiting the four-year-old actor Charles Stratton, billed as the 11-year-old General Tom Thumb. Stratton was taught to imitate famous figures such as Hercules and Napoleon.

In 1843, Barnum hired the Native American dancer Do-Hum-Me, the first of many Natives that he would present. During 1844–45, he toured with General Tom Thumb in Europe and met Queen Victoria, who was amused but saddened by Stratton, and the event was a publicity coup. It opened the door to visits with royalty throughout Europe, including the tsar of Russia, and enabled Barnum to acquire many new attractions, including automatons and other mechanical marvels. During this time, he bought other museums, including artist Rembrandt Peale 's Philadelphia Museum (the nation's first major museum), and the Baltimore Museum and Gallery of Fine Arts. By late 1846, Barnum's American Museum was drawing 400,000 visitors per year.