Toy Story was the first Pixar feature film to receive a theatrical sequel, before Pixar's Cars 2.
Pixar's Toy Story debuted in 1995 as the studio's first feature film and the first fully computer-animated feature. Its sequel, Toy Story 2, was released theatrically in 1999, making the Toy Story series the studio's earliest theatrical follow-up.
This chronology matters when comparing Pixar's franchises. A Bug's Life, Monsters, Inc., Finding Nemo, and The Incredibles all began as successful original features, but their sequels arrived later than Toy Story 2. Cars followed with Cars 2 in 2011, five years after the first Cars film.
Toy Story 2 was originally planned for a home-video release before being upgraded to a theatrical release. That change helped establish Pixar's sequel strategy, which later included Cars 2, Toy Story 3, and many other franchise continuations. The question concerns Pixar feature films, not short films or television specials.