The unusual donation, which is being sold for 1,500, was given to Save the Children's Living and Giving shop in Stockbridge.
Staff have nicknamed the horse Jebb after Save the Children's Founder, Eglantyne Jebb.
Rob McMillan, Save the Children's retail manager for Scotland, said: "While the horse is worth much more thanks to the incredible craftsmanship that has gone into it, the maker felt that the money raised would be of great value to Save the Children's work.
"We're overwhelmed by such a donation and the work that has gone into the horse is phenomenal."
The horse goes on sale at the Raeburn Place store from Friday, 11 June.