The theatre opened on 14 March 1741, the creation of the Habsburg Empress Maria Theresa of Austria who wanted a theatre next to her palace. Her son, Emperor Joseph II called it the "German National Theatre" in 1776. Three Mozart operas premiered there: Die Entführung aus dem Serail (1782), Le nozze di Figaro (1786) and Così fan tutte (1790). Beginning in 1794, the theatre was called the "K.K. Hoftheater nächst der Burg". Beethoven's 1st Symphony premiered there on 2 April 1800.

The theatre was moved to a new building at the Ringstraße on 14 October 1888 designed by Gottfried Semper and Karl Freiherr von Hasenauer.

In 1943, under Nazi rule, a notoriously extreme production of The Merchant of Venice was staged at the Burgtheater - with Werner Krauss as Shylock, one of several theatre and film roles by this actor pandering to antisemitic stereotypes.

On March 12, 1945 the Burgtheater was largely destroyed in a bombing raid, and, one month later, on April 12, 1945, it was further damaged by a fire of unknown origin. After the war, the theatre was restored between 1953 and 1955. The classic Burgtheater style and the Burgtheater-German language were trend-setting for German language theatres.