The Theatre was an Elizabethan playhouse in Shoreditch (in Curtain Road, part of the modern London Borough of Hackney), just outside the City of London. Built in 1576, after the Red Lion, it was the first permanent theatre built exclusively for the showing of theatrical productions in England, and its first successful one. Actor-manager James Burbage built it near the family home in Holywell Street. The Theatre's history includes a number of important acting troupes including the Lord Chamberlain's Men, which employed Shakespeare as actor and playwright. After a dispute with the landlord, the theatre was dismantled and the timbers used in the construction of the Globe Theatre on Bankside.

The Mayor and Corporation of London banned plays in 1572 as a measure against the plague, not wanting to attract crowds of strangers. In 1575 they formally expelled all players from the city. This prompted the construction of playhouses outside the jurisdiction of London, in the liberties of Halliwell/Holywell in Shoreditch and later the Clink, and at Newington Butts near the established entertainment district of St. George's Fields in rural Surrey. The Theatre was constructed in 1576 by James Burbage in partnership with his brother-in-law, one John Brayne, (the owner of the Red Lion) on property that had originally been the grounds of the dissolved Halliwell Priory (or Holywell). Brayne had advanced Burbage the money needed to build The Theatre, and in return, Brayne received a portion of the profits and owned some of the property (Burbage married Brayne's daughter Ellen in 1575). The Theatre was in Shoreditch, beyond the northern boundary of the City of London and outside the jurisdiction of civil authorities, who were often opposed to theatre. This area in the "suburbs of sin" was notorious for licentious behaviour, brothels and gaming houses. A year later, the Curtain Theatre was built nearby, making the area London's first theatrical and entertainment district. "When Burbage and Brayne mortgaged The Theatre, Brayne had just recently resolved another fight with one of his brothers-in-law over a different mortgage" Brayne and Burbage had never written a contract, which eventually led to many quarrels concerning who spent what on getting The Theatre started.

Throughout the building of The Theatre, Burbage and Brayne continually became indebted to each other. To fix this they constructed schemes to keep the building of The Theatre going. John Hind was one of the creditors for the construction of The Theatre, however, almost nothing else is known about him except that there was also a contract between him and Burbage/Brayne which entailed that he arrange players for them. One of their schemes was to put on plays in The Theatre while it was still being built, to raise money for further construction.

Although Burbage's son later claimed the Theatre as the first permanent playhouse in the London conurbation, it may not have been the first permanent theatre to serve Londoners. The Newington Butts Theatre may have been built as early as 1575, certainly actor Jerome Savage renewed a lease on the site on 25 March 1576, three weeks before Burbage's lease in Shoreditch. Newington Butts was clearly established by Lady Day 1577, and Wickham et al. interpret the available documents as saying that Savage was adapting an existing building constructed by Richard Hicks rather than building from scratch.

The design of The Theatre was possibly adapted from the inn-yards that had served as playing spaces for actors and/or bear baiting pits. The building was a polygonal wooden building with three galleries surrounding an open yard. From one side of the polygon extended a thrust stage. The Theatre is said to have cost £700 to construct, which is a considerable sum for the age.

The open yard in front of the stage was cobbled and provided standing room for those who paid a penny. For another penny, the attendees were allowed into the galleries where they could either stand or, for a third penny, procure a stool. One of the galleries, though sources do not state which, was divided into small compartments that could be used by the wealthy and aristocrats. The playhouse was a timber building with a tile roof; other materials used to construct the Theatre were brick, sand, lime, lead, and iron. Owing to a lack of paperwork not much is truly known about the Theatre's appearance, but it has been described as an "amphitheater".

The Theatre opened in the autumn of 1576, possibly as a venue for Leicester's Men, the acting company of Robert Dudley, 1st Earl of Leicester of which James Burbage was a member. In the 1580s the Admiral's Men, of which James Burbage's son, Richard was a member, took up residence. After a disagreement between the company and young Burbage, most of the company left for the Rose Theatre which was under the management of Philip Henslowe.

In 1594, Richard Burbage became the leading actor of the Lord Chamberlain's Men which performed at The Theatre until 1597. Poet, playwright and actor William Shakespeare was also in the employ of the company and some of his early plays had their première at The Theatre. "At Christmas 1594 [Richard] was summoned with two other members of his company, William Kempe and William Shakespeare, to act before the queen at Greenwich Palace... Numerous performances before Queen Elizabeth followed, and Shakespeare doubtless often accompanied Burbage on many subsequent professional visits to one or other of the royal palaces." Richard's most noted role is—which holds close to his namesake — his part as Richard in Shakespeare's Richard III. After the Burbages stripped The Theatre of its materials to erect The Globe, many of Shakespeare's plays were performed at the famous theatre in the summer and the Blackfriars house, another of the Burbage's theatres, was used as a winter playhouse.