The Elf on the Shelf is a popular holiday tradition that involves placing an elf figurine in various locations around the home, keeping track of children's behavior and reporting back to Santa. The tradition began in 2005, with the launch of the book "The Elf on the Shelf: A Christmas Tradition." The book tells the story of a toy elf that is brought to life by Santa and given the task of watching children and reporting their behavior back to him. The elf then hides in the home and watches over the children, moving to a new location each day.