The theatre was started by Julius Caesar and finished by Augustus (27 BC - 14 AD) in 17 BC, when the Ludus Saecularesgames were held there. In 13 BC or 11 BC the theatre was dedicated to thememory of Marcellus, Augustus’s nephew and heir who died prematurely. 

The building stands on the site where theatrical events had been staged using removable timber structures that took up a part of the curved side of the Circus Flaminius. Later restoration work on the stagewas carried out under Vespasian. In the 13th century the theatre was turned into a fortress and in the 16th century into a noble palace of the Savelli family.This palace, the work of Baldassarre Peruzzi, was bought by the Orsini family in the 18th century. In the years 1926-32 the lower section, corresponding to the Ancient Roman structures, was purchased by Rome’s citycouncil that removed the buildings leaning on it and restored it. 

This building is the only one of the three permanent theatres (together with the Theatre of Pompey and the Theatre of Balbus) that has preserved most of its external façade. This was wholly built of travertine and originally had 41 arches flanked by pilasters and semi-columns – of the Doric type on the ground floor and Ionic style on the second storey. The third storey, now completely lost, had an attic enclosed with Corinthian style pilasters. The key stones of the arches contained large marble theatrical masks. 

The overall height of the building is thought to have been around 33 meters, while the 130-meter diameter cavea could accommodate 15,000 spectators, and could hold as many as 20,000 in particular conditions, as the Regionari Catalogues also report. Beyond the orchestra there was the stage, of which nothing remains today, flanked by two halls containing apses. Behind the stage there was a large exedra, the centre of which housed two small temples (dedicated to Pity and, perhaps, to Diana) that predated the theatre and were incorporated in it: they are also depicted in the Forma Urbis of the Severan age. 

The theatre, probably still being used in the 4th century AD, was covered by a canopy. The sources also report the presence of 36 bronze vases tofacilitate the acoustics.