Papp's group was well-regarded, and he started seeking funds in 1958 for a permanent outdoor amphitheater in Central Park, with the aid of Helen Hayes.

The city government decided to go forward with the project, and the Board of Estimate approved $250,000 in funds for construction, with Park Department architects designing the original theater.

Delacorte, a fan of Shakespeare, agreed to fund the remaining $150,000 to finish construction of the theater, which was named in honor of him and his wife Valerie in gratitude.

[6][7] They cited several goals for the renovation: better accessibility for disabled patrons and performers, improved backstage flow and operations, a new facade, replacement of the stage floor due to exposure and weather damage to the original deck, and better lighting.

[13][16] As part of the renovation, the theater is being rebuilt with wood recycled from water towers atop apartment buildings in New York City.