It is believed that potatoes were first prepared in this way by George Crum, a chef at the Moon Lake Lodge in Saratoga Springs, New York on August 24, 1853. He was fed up with a customer, by some accounts Cornelius Vanderbilt, who continued to send his fried potatoes back, because they were too thick. Crum decided to slice the potatoes so thin that they couldn't be eaten with a fork. Against Crum's expectation the guest was ecstatic about the chips. They became a regular item on the lodge's menu under the name Saratoga Chips. They soon became popular throughout New England.
A mass marketed potato chip could not become popular until the 1920s when the mechanical potato peeler was invented. This product was developed by Herman Lay, a travelling saleman in the U.S. south. Potato chips generate a sizable amount of revenue in the American snack food industry, with hundreds of millions of dollars worth of the food being sold every year.
The potato chip or crisp remained unflavored, which limited its appeal, until an innovation by the owner of an Irish crisp company called Tayto, who developed a technology to add flavoring in the 1940s. Though a small company, consisting almost entirely of his immediate family who prepared the chips, the owner had long proved himself an innovator. After some trial and error, he produced the world's first flavored potato chips, 'Cheese and Onion' and 'Salt 'n' Vinegar' (in which in the latter case the salt was originally sold in a sealed packet inside the chip packet, to be added when required).
His innovation became an overnight sensation in the food industry, with the heads of some of the biggest potato-chip companies in the United States heading to Dublin to the small family-run Tayto business to examine the product and to negotiate the rights to use the new technology. When eventually, the Tayto company was sold, it made the owner and the small family group who had changed the face of potato chip manufacture one of Ireland's wealthiest men, able to retire to the Riviera and to work on other ideas. Companies worldwide sought to buy the rights to his technique.
That Tayto Crisps innovation changed the whole nature of the potato chip. Later potato chip manufacturers added natural and artificial flavors to potato chips, with varying degrees of success. A product that had had a large appeal to a limited market on the basis of one flavor now had a degree of market penetration through vast numbers of flavors that would have astonished George Crum. The most popular forms of flavored potato chips include "sour cream and onion," "barbecue," and cheese-flavored chips. Various other flavors of potato chips are sold in different parts of the country, including the original "salt and vinegar", produced by Tayto, which remains by far Ireland's biggest manufacturer of crisps. Some companies have also marketed baked potato chips as an alternative with a lower fat content.
The success of potato chips also gave birth to fried corn chips, with such brands as Frito's, CC's and Doritos dominating the market.
In American cuisine, a whole class of recipes exists that use crushed potato chips, often like one would use bread crumbs. These include cookies, pies, breadings for meat, sauces or dips, hamburgers among others.
In British usage, where these are called "crisps", the term "chips" refers to what Americans call french fries. In Australia, New Zealand and South Africa, both forms of potato product are simply known as 'chips', as are the larger 'home-style' potato chips.The Origin of the Potato Chip
The Appearance of Flavored Potato Chips