NORTH HILLS, CALIF. – They stand 10.5 inches tall, sport fashions that would make J. Lo blush and they’re worth a billion dollars.

Bratz, styled as an edgy alternative to Barbie, have shaken up the fashion doll world quicker than a clearance sale at Bloomingdale’s. Dressed in hip-hugging, navel-baring pants, heavily made up and teetering atop platform heels, the dolls have turned into a $1 billion annual seller for MGA Entertainment Inc. Even after a year and a half on the market, they’ve retained a lock on their segment, with MGA projecting a sellout for the holiday season.

Though Barbie, Mattel’s pink-packaged warrior who anchors the giant’s $2.2 billion annual girls’ business, presentr fierce competition, MGA’s chief executive officer Isaac Larian projects major growth for Bratz.

”Not every girl in the real world is 6 foot 2 and beautiful like Barbie,” Larian said. ”They’re not all blond. We want to apply to all ethnicities.”

With their almond-shape eyes and dark-tinted skin, the figurines were styled as a conscious alternative to Barbie’s Caucasian, statuesque body mold. Aimed at an older audience, girls ages 8 to 12, the dolls have sold more than a million units and have inspired Mattel to fire back with its own My Scene Barbie in November.

Though Mattel says the My Scene dolls, which boast similar clothes, attitudes and facial features, were planned years ago, industry experts disagree.

”There’s a direct connection,” said toy analyst Chris Byrne, who follows the business for TheToyGuy.com. ”Bratz opened up the fashion doll market to a hip, edgier older doll, and Mattel has responded to that market. The good news is MGA has a two-year jump. The bad news is that now that Mattel’s on the same trail, they can outspend (MGA) by a factor of God only knows what.”

Though the upstart Bratz sales have amazed the toy business, Mattel Girls spokeswoman Julia Jensen professed no worries. Its My Scene dolls, which feature African-American and dark-haired dolls alongside a more provocative Barbie, represent a brand evolution, she said, rather than a response to any competitive pressure.

”The My Scene dolls are an evolutionary step in the incredibly long, vibrant life span of the Barbie brand,” she said. ”We have 43 years of owning the girls’ toy market behind us, so this is just the latest step.”

Larian dismisses the competition, pointing to MGA’s broadly diversified portfolio as insurance against any market share that Barbie claims back. He still forecasts that Bratz will bring in up to $3 million in sales in coming years, but if it falls off, he can rely on the firm’s Land-Sea RC radio-controlled vehicles or licensed material featuring Spider-Man and the Incredible Hulk.

From his cramped office, which resembles an overstocked toy store, the 48-year-old CEO exudes an easy confidence about the details of the famously fierce toy business. As the 90-percent owner of the privately held firm, he’s been able to reap the benefits of his hot products, but still speaks of his beginnings as a dishwasher.