Battle Beasts came out in 1986 from the Hasbo company. They were 1" figures that came with a weapon and had a heat sensitive holographic sticker on their chest. The sticker could be either wood, fire, or water. Depending on the sticker that would let you know who could beat who. Wood beat water, fire beat wood, and water beat fire. Simple but oh how much fun I had with them.
Each figure was a mix between a man and an animal. They were sold in 2 packs and 8 packs.
In addition to the figures they also released chariots for each element. These were like vehicles and you could pull them back and they would zip away. I usually just made them crash into one another.