Answer:
Each year, the tooth fairy collects thousands of teeth. Over millions of years, she has collected milions of teeth. Similar to Santa Claus, she has thousands of elves to do her bidding. Unlike Santa Claus, these elves aren't really elves. They're teeth that have mutated into teeth-people. These teeth-people have only one objective: to colonize the earth with more teeth-people. The tooth fairy knows this, and uses it to her advantage. She grinds into the teeth-people's brains that if they follow her orders, it will lead to the colonization of earth by the teeth people, ruled by herself, the tooth fairy.
Now, what she does with the non-mutated teeth is quite simple. She uses them to expand her earth colonizing arsenal. Some teeth are ground into teeth dust and then mixed into a clay stronger than iron, which is used to create a device (shockingly similar in design to the death star.) This device has the power to suck the teeth from all the humans on the earth. (Not the animals though, the teeth people wish to live harmoniously with them.) This device will be used to extract the teeth and once all the humans are toothless, she will dispose of them by setting them into orbit aboard what appears to be a giant tooth biosphere, in which they will live in a climate similar to that of a tooth. Why? I guess she has a weird sense of humor.
Surprisingly enough, every dentist and dental hygienist (and person training to be one) in the world is aware of this plan, and they are in fact promised to rule over one of the orbiting teethmobiles. Since no one will have any teeth, theirs will be the only profession that is no longer necessary. So, this plan not only leads to them ruling over humanity, but it leads to a free retirement! Because let's face it, no one wants to be a dentist if there isn't a world takeover plan that comes with it.
In fact, the tooth fairy is the one who created the career of a 'dentist'. Why? In order to keep all the teeth in the world as clean as can be so they are ready to be built with right away.
The tooth fairy has already employed several thousand dentists who take care of the teeth she is storing.
Where, you ask? Well, there is a gargantuan warehouse in the sky that is shaped like a tooth. However, it has a giant invisibility cloak covering it. (Yeah, those are real too.)
Why have you never been told this? Well, everyone who knows of this is sent a notice that if they tell others, their teeth will be sucked out by the death star tooth thingy. I've already mentally prepared myself to lose all my teeth.
So kids, every time you put a tooth under the pillow, you are unknowingly contributing to the destruction of the earth as we know it... but contributing to the rise of the tooth empire.
Hope this helped!