Legend suggests that, in the late 16th century, Martin Luther (the founder of the Protestant religion) was the first to decorate an indoor tree with candles when he attempted to recreate the stars shining over a forest of evergreens.
The first mention of decorated trees being taken indoors came in 1605 in Germany - a country with a long Christmas tree history! The trees were initially decorated with fruit and sweets together with hand made objects such as quilled snowflakes and stars. German Christmas Markets began to sell shaped gingerbreads and wax ornaments which people bought as souvenirs of the fair and took home to hang on their tree.
Tinsel was also invented in Germany in about 1610. Up until fairly recently real silver was used, which was pulled into wafer thin strips by special machines. This was durable but tarnished quickly and many experiments took place to try and find an alternative - including a mix of lead and tin, which was too heavy and kept breaking. It was only in the mid 20th century that a viable alternative was found.
Artificial trees were invented in the 1880's in a bid to try and stop some of the damage being caused to real trees due to people lopping the tip off large trees, thus preventing the trees from growing any further. It got so bad in Germany that laws had to be brought in to prevent people having more than one tree.