Although a concert room had existed on the site since approximately 1844, the Grade II* listed theatre seen today was built in 1866, when it was the Star Music Hall. Changing ownership and name to Star Theatre of Varieties and then Star Theatre it became the home to Liverpool Repertory Theatre Company, which was established in 1911, and disbanded in 1999. The name was changed to The Playhouse in 1917. Among actors in the company were Edward Mulhare, Robert Donat, Michael Redgrave, Alex Atkinson, Anthony Hopkins, John Thaw and Ian McKellen. During the Second World War it was home to the Old Vic. The theatre was briefly closed in the late nineties, but reopened in 2000 under the management of Liverpool and Merseyside Theatres Trust who also run its sister theatre, the Everyman. The Playhouse has become the venue for numerous acclaimed new productions mainly of old plays, in contrast to the Everyman Theatre, which has focused on new works.
In September 2003, Gemma Bodinetz (artistic director) and Deborah Aydon (executive director) took over the running of the Playhouse and the Everyman Theatre.