A penny arcade can be any type of venue for coin-operated devices, usually for entertainment. This included early forms of pinball and fortune telling machinery of the 1930s. Vending machines may also be considered in this category. The name derives from the penny, once a staple coin for such machines.
The earliest penny arcades from the nineteenth century had machines called bagatelles—a game combining pinball and billiards. Later, penny arcade machines grew closer to modern pinball.
Another form of machine found in penny arcades were peep show machines (ancient usage of the term) which allowed the viewer to see various views of objects and later moving pictures. Slot machines, love testers, fortune teller machines and other coin operated devices were found in such venues.
Penny arcades later led to the creation of video arcades in the 1970s.