The amateur Stamford Shakespeare Company was founded in 1968 by Jean Harley, the present Artistic Director, with a performance of "A Midsummer Night's Dream" in the Monastery Garden of the town's historic George Hotel. It was under the auspices of the Stamford Arts Centre Committee in aid of the proposed new Arts Centre and restoration of the Georgian Theatre in St Mary's Street.

In 1971, with the arts centre programme well under way the theatre group became independent and was named for the first time, the Stamford Shakespeare Company.

Open air Shakespeare plays continued at The George for nine years until the last performance in 1976. The hotel could no longer accommodate the summer open air theatre because of building work including a new car park and in August, 1976 the company had to look for another location.

By chance, Tolethorpe Hall came on the market in a near derelict state early in 1977 and it was acquired by the Stamford Shakespeare Company with the help of a generous private loan later repaid. The main interest was a natural amphitheatre in the grounds which was quickly converted into a concrete stepped, raked auditorium covered by a temporary canvas canopy. The first season opened May, 1977 with performances of 'Macbeth" and "The Taming of the Shrew".