The 38M Toldi light tank, contrary to its designation, went into service in 1940. At the time it was the state of art armoured weaponry of the Hungarian Army. Before that time the Army had its WW1 style armoured trains, armoured cars and the tiny Italian FIAT Ansaldo tankettes. The 38M Toldi light tank and its Swedish origin the L-60 were the same class as the German Pz. II, the Polish 7TP, the Soviet T-40 and T-60 light tanks, designated for reconnaissance and liaison role.

However, at the beginning of the war it was the only tracked armoured vehicles of the Hungarians to fight the Red Army in 1941.
The 38M Toldi light tank was also the first armoured vehicle produced by the Hungarian War Industry during the war.