The History of D&D Miniatures
How it Began
In June of 2002 Wizards of the Coast announced that they would be cancelling their current miniature line (called Chainmail) in August of that year. They also mentioned that they were working on a related game that used the Dungeons and Dragons brand.
That game turned out to be Dungeons and Dragons Miniatures, also known as DDM. Wizards of the coast released 'sets' of miniatures that consisted of between 40 and 80 miniatures per set, as well as a few stand alone large-scale miniatures and a few sets of 18 miniatures marketed towards players of the roleplaying game.
Each set was released as randomized packs of miniatures with anywhere between 5 and 16 miniatures per pack depending on the set, and whether or not it was a 'starter' pack. Each pack of miniatures consisted of miniatures with differing ratings based on how many paint steps were used to create the miniatures, the general complexity of the sculpt, and (to some extent) how often a dungeon master would use them in the roleplaying game. The different ratings were: Common, Uncommon, Rare, and (in the Lords of Madness set) Very Rare.
For more information on the specifics of each set, please visit the Miniature Sets page.
DDM
Along with the utility of having miniatures that were suited for the Dungeons and Dragons roleplaying game, the sets were released with rules for how to create 'armies' of monsters using stat cards that came with the miniatures. You could then pit your army against other people's armies using card stock map tiles that came in the original set. Later on, the card stock map system was replaced with large color foldout maps that Wizards of the Coast produced.
Along with many local gaming groups and stores that promoted leagues and tournaments, Wizards of the Coast also had a DDM national champion each year at GenCon where contestants could battle against each other for special prizes (usually large miniatures with alternate paint jobs) provided by Wizards of the Coast.
In 2008 the Dungeons and Dragons roleplaying game was updated to their 4th edition of the rules, and the rules for DDM were updated to fall more in line with the changes being made to the roleplaying game.
In fall of 2008 Wizards of the Coast announced changes they would be making to the packaging of the D&D Miniatures line. Shortly thereafter they also announced that with the new sets, they would no longer be supporting the Dungeons and Dragons Miniatures stand-alone game. In the aftermath, a group of people from the player community formed DDM Guild, and were granted exclusive rights to continue to support the rules and tournament play for the DDM game.
The Beginning of the End
In 2010, after releasing three monster sets in the new format, Wizards of the Coast announced a return to the previous random miniature format with the Lords of Madness set which was released in fall of 2010.
On January 12, 2011 Wizards of the Coast announced the end of their plastic miniatures line. They said that they would continue to release plastic miniatures in some of their forthcoming board games, with the possibility of a few specially marketed miniature releases (in the vein of the Icon miniature sets).