The 96-year-old hall will become the new home of the Australian Capital Theatre Hub, providing a regular stage for four local, independent groups: the Mockingbird, Free-Rain, Everyman and Chaika theatre companies.

It's a fitting location, with actors returning to where Canberra's first community production was staged: a March 1926 season of Douglas Murray's The Man From Toronto.

Mockingbird Theatre Company artistic director Chris Baldock said he could see the history in the hall, and it was fortuitous it would again be a home for local theatre.

"It's a complete full circle, as far as I'm concerned. We all feel very proud, and humble, that we're doing that," he said.

Mr Baldock said he wanted to show things that were challenging and different from usual productions in Canberra, and build up audiences for work that has never been seen in the ACT before.

"I'm just hoping that Canberra theatre-goers, and people who even aren't so much regular theatre-goers who will become regular theatre-goers, will go, 'There is a play on tonight that would never normally get seen here that's a little bit more interesting, a bit more provocative, a bit more challenging, but still entertaining and still thought-provoking. Let's go and see it'," he said.

"We want to grow to the point where we're full and then we get too big for this place. And then we can go and say, 'Now it's time for our audiences to be in The Playhouse', or whatever the case may be. But we have to grow."

Free-Rain Theatre's Anne Somes said the Causeway Hall had been all things to the community in its long history, and ACT Hub was just another step.

"I think Canberra is coming to the cultural forefront and I think that we're in a position whereby we can now show that that is the case," she said.

Mrs Somes, whose company was established 27 years ago, said the hub would help support local actors' professional careers and hopefully bring people back to the ACT to perform for a growing, and committed, audience.

"We want to be able to say there's always going to be something there that is going to appeal, and across a diverse demographic as well. The opportunities are endless and I just think the timing's right. We'll see how we go, but we're excited," she said.

Arts Minister Tara Cheyne said the exciting proposal would mean the hall would be transformed within the bounds of its heritage registration into a multi-functional performance space, an initiative that sat within the strategies in government's statement of ambition for the arts.

"With an eight-show season, classes, workshops and various special theatrical events throughout the year, the ACT Hub will also focus on providing development opportunities for emerging directors and designers," Ms Cheyne said.

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Ms Cheyne said the hall would be leased to ACT Hub by the government on an initial two-year agreement with priority use of the venue, and would still be available for community events and casual hirers. She said community consultation earlier in the year found strong support for the project.

The Causeway Hall was built in 1925 by volunteers from the Canberra Social Service Association with supplies from the Federal Capital Commission, and is the last remaining substantial building from the original settlement of the Causeway.

As the first purpose-built hall, it was Canberra's principle entertainment venue in the city's earliest years. The hall hosted movies, dances, concerts and boxing matches. It was heritage-listed in 2005.

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