Originally founded as the Community Playhouse, it was the first theatre in New South Wales devoted to producing Australian drama. It occupied St Peter's Church Hall in Darlinghurst, now part of SCEGGS. Though its intention was to foster an Australian theatre tradition, the organisation proved a disaster. It was taken over by Beryl Bryant and renamed. The Playhouse was the crypt of a church with two dressing rooms and an audience capacity of 90.