The Mutant Toys are major characters in Toy Story. They were built by Sid from mixed pieces of several toys that belonged to him and Hannah. They lived in Sid's house, hidden in the dark corners of his room.
When Woody and Buzz Lightyear first encountered them, the two thought they were cannibals who were going to eat them, especially when they blocked the escape route for the duo with Buzz using his laser to aim at them, but realizes that his laser is not working as Buzz is still unaware that he is a toy. Holding Buzz as a hostage, Woody pushed the button on Buzz's back to make Buzz's arm chop to back them away as the duo tried to escape.
However, when the Mutant Toys later placed Buzz's severed arm back in place, as well as taping the heads of Hannah's Janie doll and Sid's toy Pterodactyl back to their correct bodies, Woody was stunned to see that they were not cannibals as he and Buzz had initially thought them to be. After Sid took Buzz (whom he had strapped his new rocket to) outside to be blown up, the Mutant Toys agreed to cooperate with Woody in his plan to rescue Buzz from Sid's clutches while also seeing this as their own chance to get revenge on Sid. Working together, they first drove Sid's dog Scud, who had stationed himself outside Sid's room, away and out onto the front porch so the toys could safely escape into Sid's backyard.
Once outside, they moved into their final positions, from where they emerged out, surrounding Sid, as Woody told him how much they don't like the way Sid was treating them (being blown up, smashed, or ripped apart) and that they would find out if Sid didn't take good care of his toys because "we toys can see everything." After Woody scared Sid away with his own voice, "So play nice," and caused him to retreat in fear of his own toys (considering everything he had done to all of them), they all rejoiced victoriously. They are last seen seeing Woody and Buzz leaving Sid's house and catching up to Andy's mom's car as Woody bids farewell to the Mutant Toys after Woody and Buzz hear Andy and his family leaving their old house next door.