Morecambe Winter Gardens, as we see it today, is half the building complex it used to be. Its history began in 1878 at the People's Palace, which included seawater baths, an aquarium, and bars and a ballroom for entertainment. The baths were located on the site where the current theatre stands; remnants of the baths can still be seen in the basement.
Internal rebuilding in 1898 added an upper circle and brought the theatre's total seating capacity to 2200. Sometime around 1908 a glazed veranda was erected across most of the front of the two buildings, but for some reason it stopped just short of the theatre's left tower. More building and renovation work in 1909 saw the addition of a further balcony (the galleries), a funfair outside at the rear of the theatre, and a billiard room beneath the ballroom.
As English seaside holidays fell out of popularity the complex began to lose money; the fiarground was closed and cleared. In 1968 the ballroom was converted into The Dixieland Palace Showbar and The Coral Reef Bar. The theatre hosted regular shows up until 1977 and the Dixieland Bar closed in 1978. In 1982 the original part of the Winter Gardens, the ballroom, was raised to the ground and demolished. This is the same year that the theatre building was declared a listed buidling.