Phoebe McFadden picked up her absolute favourite toy of the moment, a sexy, spiky-fanged vampire figurine wearing a punky fuchsia miniskirt and knee-high boots. "My favourite is Draculaura," she explained, pulling on the doll's raven locks. "We have a lot in common – we both really like pink."

Dazzled by the array of toys on offer in the new 26,000 square foot Harrods Toy Kingdom, which quietly opened its doors this week in time for a grand launch on Sunday, the eight-year-old appeared blissfully unaware of the store's "ground-breaking" move to make it less gender-specific.

But, following in the footsteps of Hamleys, which removed "boy" and "girl" signposts from its shop last December, the London department store has deliberately organised its new multi-sensory toy zone by theme rather than sex. "We felt it was a bit of a risk, when that formula traditionally works, to turn around and break the mould," said David Miller, director of Harrods Home, who said the store was aiming to create "retail theatre" and attract the customers of the future.

If Harrods hopes to loosen the gender-specific tyranny of toys, it has a battle on its hands. While the Lego and Hornby train-filled Wonderland was crammed with small boys intent on destruction on the Guardian's visit this week, the Enchanted Forest, with fairy voices emanating from multicoloured flowers and hundreds of dolls, was the main draw for girls.

Some aspects of the six-zone Toy Kingdom have left feminists marking their store card "could try harder". While space in the department may be free of explicit labels, the ebullient and youthful staff are clearly demarcated: female workers wear natty pink T-shirts with the slogan Team Toy on their backs, while men, inevitably, are in blue. A decision made entirely because they were nice colours, according to Miller.

"We are not stopping our female members of staff wearing a boy T-shirt, should they want to," he said, adding: "Although they are a different cut." So there were no gender connotations whatsoever in the choice? "No, none at all."

It is a hopeless own goal, according to Emma Moore, founder of Pink Stinks, which campaigns against gender-targeted products and marketing. "It's pathetic and lazy and just shows how entrenched these ridiculous stereotypes are," she said.

But she applauded the company's move to organise toys around theme rather than gender. "It's a small step, but it's a step in the right direction. But if retailers do not do this they are missing a trick. There is a growing movement of mums and dads who want toys designed for children – not girls and boys."

Lead designer of the project, Matt Smith, of Shed Design, who created the multimillion pound overhaul, said the "amazing dreamscapes" which lead children on a journey through the toy department were designed to appeal to both boys and girls. "They are deliberately non-gender-specific, because we felt that was an antiquated way of looking at toys," he said. "I think increasingly kids are playing with an array of different toys and we wanted to give that balance."

Use of lighting and atmospheric music mark the transition from one area to the next. The oompah soundtrack of the Big Top leads to the twinkling fairy noises, dappled light and birdsong of the Enchanted Forest before the hooting of trains and zip of Scalextric cars in Wonderland and sci-fi bleeps of the Odyssey gadget zone make way for swashbuckling pirate cries or the whoosh of magic wands in the Reading Room.

"It is a shame when toy departments just become a place to sell a retail product," he said. "We didn't want to lose that magic, which is why we wanted it to be so much more than a toy shop."

There are a dizzying number of toys on offer, from the return of Cabbage Patch kids, to puzzles, dressing-up kits, computer games and magic tricks. This being Harrods, there is a petrol-powered child Mercedes SLK is on sale for a cool £6,995 while a towering doll's house costs £8,995.

But while the store has made a positive move by grouping toys by product, it is the toys on offer that really matter, according to Dr Laura Nelson, who led the campaign against Hamleys and has set up a gender stereotypes project in schools to tackle the issue. "Gender stereotyping of toys restricts the choices of children and their parents; it influences the activities children engage in, their interests and skills and ultimately the roles they take in society," she said. "Until all toys and the shop layouts are completely gender-neutral, there will always be pressure on girls and boys to pursue the route in life consistent with their stereotype."

Jackson Castleberry, a 10-year-old on holiday from Texas, appeared to have taken a leap across the gender divide, saying he had nothing against the mixing of the toys and wouldn't mind going into the dressing-up section. "It doesn't mean you have to buy it, right?" he said.

Review by Phoebe McFadden, 8½

With a boggle-eyed toy chihuahua wedged firmly under her arm, Phoebe McFadden and her mother Clodagh, took the Guardian on a tour of the new Toy Kingdom. "It's totally awesome, I really really love it," was the initial judgment from the sharp-eyed reviewer. While the Odyssey room was thought "cool", it was also a little "boysy" for Phoebe, who loved the stuffed toys and dolls on offer the best.

At her most energised in front of the Monster High figurines, she was also a big fan of the book department, with its imagination-inducing soundscapes and nooks for reading. "I like the noises. They make you think about the stories in the books," she said. Cabbage Patch kids, back on the scene after a spell in the cold, were a bit "weird", while Madame Alexander dolls – with their detachable wigs and outfits – were decidedly great.

Phoebe thought it was nice that all the toys were mixed in because it gave children plenty to look at,

but the toy that really grabbed her was the giant doll's house, at nearly £9,000. Even after saving up all her pocket money, it was going to be a struggle. Looking around at the thousands of toys, she said: "It's just so difficult to decide what to buy."