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Christmas crackers are part of Christmas celebrations primarily in the United Kingdom, Ireland and Commonwealth countries such as Australia, Canada, New Zealand and South Africa. A cracker consists of a cardboard tube wrapped in a brightly decorated twist of paper, making it resemble an oversized sweet-wrapper. The cracker is pulled by two people, often with arms crossed, and, much in the manner of a wishbone, the cracker splits unevenly. The split is accompanied by a mild bang or snapping sound produced by the effect of friction on a shock-sensitive, chemically-impregnated card strip (similar to that used in a cap gun). One chemical used for the friction strip is silver fulminate, which is highly unstable.
Assembled crackers are typically sold in boxes of three to twelve. These typically have different designs usually with red, green and gold colours. Making crackers from scratch using tissue paper and the tubes from toilet rolls is a common activity for children.
Crackers are typically pulled at the Christmas dinner table or at parties. In one version of the cracker tradition, the person with the larger portion of cracker empties the contents from the tube and keeps them. In another each person will have their own cracker and will keep its contents regardless of whose end they were in. Typically these contents are a coloured paper hat; a small toy, small plastic model or other trinket and a motto, a joke, a riddle or piece of trivia on a small strip of paper. The paper hats, with the appearance of crowns, are usually worn when eating Christmas dinner. The tradition of wearing festive hats is believed to date back to Roman times, and the Saturnalia celebrations, which also involved decorative headgear.
The Oxford English Dictionary records the use of cracker bonbons and the pulling of crackers from the early 1840s. Tradition tells of how Tom Smith of London invented crackers in 1847. He created the crackers as a development of his bon-bon sweets, which he sold in a twist of paper (the origins of the traditional sweet-wrapper). As sales of bon-bons slumped, Smith began to come up with new promotional ideas. His first tactic was to insert "love messages" into the wrappers of the sweets (cf. fortune cookies).
Smith added the "crackle" element when he heard the crackle of a log he had just put on a fire.  The size of the paper wrapper had to be increased to incorporate the banger mechanism, and the sweet itself was eventually dropped, to be replaced by a trinket; fans, jewellery and other substantial items. The new product was initially marketed as the Cosaque (i.e., Cossack), but the onomatopoeic "cracker" soon became the commonly used name, as rival varieties came on the market. The other elements of the modern cracker —the gifts, paper hats and varied designs— were all introduced by Tom Smith's son, Walter Smith, to differentiate his product from the rival cracker manufacturers which had suddenly sprung up. As the demand for crackers increased, Tom Smith merged with Caley Crackers in 1953 taking over their headquarters and factory in Norwich, East Anglia.
- McAlpine, Fraser (7 December 2011). "Part 3: Crackers". A Very British Christmas. BBC America. Retrieved 25 December 2012.
- "Christmas Crackers USA". Retrieved January 2012.
- Rarely, they can be much more substantial. In 2009, Harrod's offered a version of Christmas cracker retailing at $1,000: "Harrods Luxury 6 Christmas Cracker Collection: Bling it up this festive season!"
- OED, Second edition, 1989; online version November 2010. < http://www.oed.com/view/Entry/43642#eid7942684>; accessed 23 December 2010. Earlier version first published in New English Dictionary, 1893.
- Peter Kimpton. Tom Smith's Christmas crackers: an illustrated history. Tempus, 2005. ISBN 0-7524-3164-1
- Margaret Baker. Discovering Christmas customs and folklore: a guide to seasonal rites. p.72. Osprey Publishing, 1992. ISBN 0-7478-0175-4
- Fletcher, Damien (22 December 2011). "Christmas traditions: The history behind crackers, mistletoe, turkey, stockings, tinsel, mince pies and more". Daily Mirror. Retrieved 25 December 2012.
- "History of the Christmas Cracker". History. Tom Smith Crackers. Retrieved 25 December 2012.
- Callow, Simon (2009). Dickens' Christmas. London: Frances Lincoln. p. 138. ISBN 0711230315.
- London Christmas Past: The Invention Of The Christmas Cracker <http://londonist.com/2012/12/london-christmas-past-the-invention-of-the-christmas-cracker.php>
- Guinness World Records; online version November 2013. < http://www.guinnessworldrecords.com/world-records/4000/longest-christmas-cracker-pulling-chain>; accessed 7 November 2013.