Salvation Army education and employment early childhood tutor Sarah Robertson said the Step Ahead Playgroup - run by the Salvation Army and education provider Footsteps - spent the last of its $5000 Government start-up grant this week.
''It's fantastic,'' Mrs Robertson said.
The Ministry of Education gave the playgroup the money last year, she said.
The new toys included a gym, musical instruments and an outdoor trough for water play, she said.
The playgroup is at the Hub in South Dunedin on Wednesdays and Fridays, but stops for the school holidays.
The group had about 20 children - mostly under the age of 2 - and had been set up for young parents doing a Salvation Army course.
The course had been discontinued but the playgroup had carried on, Mrs Robertson said.
Stefanie Mortimer (27), of Dunedin, said she had been bringing her five children - Elizabeth and Julia (11 months), Aroha (1), Addison (5) and Tahlia (6) - to the playgroup for the past six months.
''It's a sanity saver. It gets me out of the house - you'd just go batty otherwise - and it gets me meeting other people, while the kids socialise. And it doesn't cost a thing.''