There's a rich history both on and behind old dollar bills and other U.S. currency notes – as well as paper money from nations around the world – which makes collecting it such a satisfying hobby. The use of paper money dates back to China in A.D. 650. Europe’s first true bank note was issued over a thousand years later, in 1661. The United States’ initial foray into paper money dates from the American Revolution and the short-lived Continental Notes used to finance the War for Independence. But they were issued in such quantity that they lost their value and disappeared from circulation.

It would take the Civil War before Congress authorized, again, the general circulation of paper currency. In 1863, the U.S. Treasury Department engraved and printed the first paper currency. They were called Fractional Notes because they were issued in denominations of less than one dollar.

BEP and the Federal Reserve Bank

In 1874, Congress passed legislation establishing the Bureau of Engraving and Printing (BEP) to manage the design, printing and, initially, the distribution of all paper currency. A succession of ever-larger printing plants went up in Washington, D.C.

By 1985, the BEP was looking for a satellite facility west of the Mississippi River. It chose Fort Worth, TX for a number of reasons. High on that list was cutting transportation costs to get newly printed paper currency to Federal Reserve Banks in San Francisco, Kansas City and Dallas for regional distribution.

In 1913, Congress had passed the Federal Reserve Act, creating a central monetary system to promote the effective operation of the economy and to serve the public interest. To help carry out those functions – including the distribution of all paper currency – it established 12 Federal Reserve Banks located in major financial districts around the country. They also serve the U.S. territories and commonwealths.

Beginning old paper money collectors can read our useful information on how to start a collection. More experienced collectors will enjoy our advanced collecting advice. For a fun read, check out Littleton Coin's Heads & Tails blog article on collecting fancy serial numbers.

Design History

The engraver's art is on full display on old dollar bills, and the design details on Federal Reserve Notes make them especially collectible. In our Learn Center you can discover fascinating and more detailed information about the notes nicknamed "horse blankets" and the small-size Federal Reserve Notes that replaced them! We also wrote about two specific examples of oversized paper currency in a Heads & Tails blog. One looks at the note nicknamed "funnyback," and the other looks at paper money that featured Christopher Columbus.

Thwarting Counterfeiters

The BEP has a legal mandate to foil counterfeiters of our nation's paper currency. It initially did so with ornate, complex designs which contribute to their collectability. In 1991 the BEP added microprinting and translucent security threads as deterrents. The next steps in protecting our paper currency were off-center portraits, watermarks, color-shifting ink and concentric fine-line printing. It is illegal to counterfeit U.S. paper money. This Heads & Tails article looks at some of the schemes that were successfully thwarted.

In a slightly different vein about fake paper currency, here's light-hearted article on movie money.

Special Issues

Littleton Coin Company's Learn Center is helpful if you're looking just to collect special Federal Reserve Notes. Many numismatists develop an interest in World War II history and also find unusual examples of wartime paper currency worth adding to their collection.

Two Final Notes on Collecting Paper Currency

Here at Littleton, you’ll find more than old paper currency for sale. You’ll also find collecting supplies, collecting tips and more. If you are wondering how to protect the paper currency you're acquiring as you build a collection, check out our Learn Center.

In 2019, Littleton launched the American Paper Money Club. You can find out more about it here.