It generated sales of $1.8bn (£1.2bn) for the six months to 30 June, up from the same period last year, overtaking United States-based Hasbro.
The British Broadcasting Corporation reported that the firm said first-half profits hit $550m and its market share rose to 8.8 per cent.
The firm is controlled by Denmark's richest man, Kjeld Kirk Kristiansen, who is the grandson of Lego's founder.
United States firm, Mattel, is the world's biggest toy manufacturer.
Lego's sales have been boosted by its new Legends of Chima range, which features animal tribe building blocks.
Lego chief executive, Jorgen Vig Knudstorp, said, "It is a very satisfactory result in view of general developments in the world toy market, which has had a slow start to the year in the largest and most mature markets of North America, Europe and Japan."
Slow sales in Europe and the US were offset by a boom in Asia, where sales soared by 35 per cent in the first half of the year.
*Who still plays with these things*
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