Kato is the family name of the company founders Yuji and Miyoko Kato.  The company is based in Tokyo, Japan with North American headquarters in Chicago.  North American operations, known as Kato USA, are operated by Hiroshi Kato, son of Yuji and Miyoko.

According to a 1991 visit by Model Railroad magazine to Kato's Japanese headquarters, Jim Kelly relates history on Yuji Kato.  We discover Mr. Kato is a lifelone railroad enthusiast and began with O-scale (1:48th) and switched interests to HO-scale in the early 1950s.  Yuji Kato's early work included making stamped parts for brass hobby manufacturers Tenshodo and Fujiyama. 

Kato's first product was an HO-scale Betterndorf freight car truck.  The first mass-produced loco was an N-scale Japanese-prototype 2-6-0, introduced in 1965.

Kato enjoys a very long build up in North America, prior to presenting products under its own name in this market.  Around 1970, Kato produces N-scale (1:160th) items for Con-Cor and this marks the debut of Kato-made releases in the U.S. and Canada.  These early Con-Cor items include the name Sekisui Kato.  Sekisui is the company's original name, which dates to the late 1950s.