Nickelodeon's initial three Nicktoons came with much fanfare and success in 1991, so it didn't come as such a surprise that the network wanted to develop new properties for the network. They already had Rocko and Hey Arnold in pre-production, but Nickelodeon wanted to start a shorts series for the network to compliment the Looney Tunes shorts that remained one of the network's most popular shows.
Enter Fred Seibert.
He was one of the people responsible for the creation of Nickelodeon's current image and look so when Hanna-Barbera's new owners decided to go in a different direction after the purchase by Turner Broadcasting (they wanted to make new versions of their library of characters rather than wanting to develop new properties), Seibert returned to the Viacom fold bringing along with him numerous artists and animators that he helped bring into Hanna-Barbera. Artists like Genndy Tartakofsky, Craig McCracken, Seth McFarlane, Butch Hartman, Van Partible, and David Fleiss joined Seibert in forming Nickelodeon Animation Studio. In 1992, they developed a new series of shorts called in-house What A Cartoon! but on the air referred to as NickShorts. In 1994, the first cycle of NickShorts aired on Nickelodeon. The very first NickShort shown was Meat Fuzzy Lumpkins, which introduced Craig McCracken's Powerpuff Girls to the world. The shorts were shown in installments of three shorts per episode. Pat Ventura created Sledgehammer O'Possum, Yuckie Duck, That's My Pop!, and a pair of new Deputy Dawg shorts. Changes introduced supergenius Dexter and his sister Dee-Dee while Butch Hartman made two self-contained shorts, Gramps and Pfish and Chip. Seth McFarlane had success bringing Larry and Steve to the lineup.
In 1995, Dexter's Laboratory was the first NickShort to become a full series. In 1996, Johnny Bravo, Pfish and Chip, and Powerpuff Girls followed. Cow and Chicken, I Am Weasel, Yuckie Duck, Sledgehammer O'Possum were paired together to form Chaotic Animals, a shorts series that was paired off with reruns of Ren and Stimpy in 1997 on MTV. Zoonatics, another NickShort turned series, also brought back the Doo Wop Dinosaurs, who were famous in classic Nickelodeon interstitials back in the 80s. As the years went on, the NickShorts continued to develop new plots and creating new shows, becoming the de facto studio of Nickelodeon animated products. The NickToons were so prominent on Nickelodeon that by the turn of the 21st century, Nickelodeon launched NickToons TV.
Nickelodeon Animation Studios formed an alliance with smaller studios including Stretch Films, DNA Films, and others to create new shows like Courage the Cowardly Dog and Jimmy Neutron, the latter of which had a trilogy of specials with fellow boy genius Dexter from Dexter's Laboratory, which reentered production after years of reruns as did fellow NickToons Rugrats and Johnny Bravo. After Powerpuff Girls ended, Craig McCracken developed Foster's Home For Imaginary Friends, which was initially developed for Nick Jr., but Fred Seibert recognized it could work better as a prime-time series. In 2007, the new generation of NickShorts will begin airing on Nickelodeon and Nicktoons Network.
Cartoon Network tried to emulate the success of the NickShorts project by bringing Fred Seibert back to the revamped Cartoon Network Studios. Dubbed the Cartoon Cartoons project, the series spawned Camp Lazlo, a new version of Huckleberry Hound, The Fairly Oddparents, Grim and The Count (a darkly comedic series that combined Billy and Mandy with Mina and the Count, the latter of which originally premiered as a NickShort) and the breakout hit Spongebob Squarepants. They were popular in their own right, but they could hardly compete with the NickShorts. Fred Seibert's Frederator Studios was based at Cartoon Network Studios, so they oversaw production of new comedy and action properties, something they continue to this day overseeing Samurai Jack, Megas XLR, Danny Phantom, and My Life As A Teenage Robot.