According to The Straight Dope, toothpicks are made from virgin white birch. The Washington Post explains that Charles Foster introduced the toothpick to the United States in the 1800s.
Virgin white birch has traditionally been used to make toothpicks because it is odorless and stiff enough to provide leverage but not so stiff that it hurts the mouth. Toothpicks were discovered in Brazil by Charles Foster, who then brought them to the United States to be manufactured. A revolutionary machine, invented by Benjamin Franklin Sturtevant, transformed logs into strips of veneer and then created points on one side of each strip. By the end of the 1860s, the toothpick had become very popular.