This paper introduces a smart toy (SmartAnimals) which provides a mixed reality environment for children with intellectual disabilities. SmartAnimals includes a virtual space including computer based animations, sounds and characters, and a real space including plastic toys, and a receiver panel. SmartAnimals with a flexible context leads children to learn daily life concepts easily. To test usability of SmartAnimals, an empirical study was carried out with 6 children having intellectual disability (ID) and four special education teachers. The findings indicated that smart toys could be beneficial for children with ID especially who have limited concentration. It enables children with easy and fast learning. Smart toys also affect children's performance in a positive way while learning cognitive concepts.