In 1868, the city government had taken a firm decision referring on the construction of the buildings of the City Hall and the theatre. This decision was encouraged by the particular economic situation of the city which at that time was in full economic development. The building was built between the years 1872-1874. In 1874, at the inauguration of the theatre, Emperor Franz Josef I himself participated. Until the World War II the theatre functioned with a section of prose and a musical one.
The building suffered two major fires. After the fire of 1882 the building was reconstructed after the plans of the architect Andor Halmay. After the second fire in 1955 the theater went through some major changes: the main entrance was moved to the boulevard, the theatre hall was reduced and it was added a studio room on the second floor. The main entrance became sumptuous, over the six columns with Corinthian gorgerins, the tympanum with bas-reliefs made by the sculptors from Arad Valeriu Brudaşcu, Ioan Tolan and Emil Vitroel was raised. In 1967, inside the theatre, it was set up a small theatre room, known to all the people from Arad as the Studio hall.