[5] When the O'Farrell Government took office in March 2011, it committed to building a line through the CBD to Barangaroo, with a preferred route along George Street.

[8] In 2012, Transport for NSW (TfNSW) decided the routes to Sydney University and Barangaroo via The Rocks provided fewer customer benefits and were considered a lower priority.

[10] On 13 December 2012, the government announced a commitment to build a $1.6 billion line from Circular Quay down George Street to Central station, then across to Moore Park and down Anzac Parade with branches to Kingsford and Randwick.

The only major engineering works on the line were a new bridge over the Eastern Distributor and a tunnel under Moore Park and Anzac Parade.

[11][17][18] The pedestrian zone is being extended southwards to Rawson Place in Haymarket as of March 2021[update] (see Post-opening works).

The section between Town Hall and Circular Quay is wire-free, with trams using Alstom's proprietary APS technology to run instead.

[17][18] Following the decision to make all tram vehicles operate in coupled pairs with a total length of 67 metres (220 ft), the plans to build double length platforms at Central and Moore Park were abandoned, and platforms of all stops were built to be 67 metres (220 ft) long.

[20] A depot for the trams was built at the north-western corner of Randwick Racecourse, providing stabling facilities and allowing light maintenance.

[22] In February 2014, three consortia were short-listed for the main contract – covering the construction and operation of the line:[23][24] The iLinQ consortium withdrew after Balfour Beatty pulled out.

The contract was finalised in December 2014, when it was also announced that the consortium had been renamed ALTRAC Light Rail, and that the opening date had been brought forward to early 2019.

[32] The CBD and South East Light Rail required significant changes to the bus networks of the Sydney central business district and the Eastern Suburbs.

[33] Some routes had their terminus changed to such places as Railway Square, Queen Victoria Building and King Street Wharf.

In March 2018 – one month before major works were originally due to be completed – the Transport Minister declined to put a date on when he expected construction of the line to be finished, but noted the government was "an unhappy customer" of the ALTRAC consortium.

[42] Acciona commenced legal action against the government in April 2018, seeking additional payments totalling $1.2 billion.

[47] In June 2019, TfNSW and ALTRAC (including Acciona) reached an agreement to resolve their commercial issues and legal claims.

[51] Cloud Arch would have acted as a gateway to the pedestrian section of George Street, with trams passing underneath it.

The launch of the service on 14 December was interrupted by a tram which broke down at Circular Quay around 14:30 in the afternoon, within hours of the official opening ceremony.

L3 passenger services between Circular Quay and Juniors Kingsford commenced operations on 3 April 2020, opening quietly amidst the prioritisation of government aid for the ongoing coronavirus pandemic during the period.

The project's Environmental Impact Statement (EIS) released in 2013 proposed a redesigned bus network in the CBD and the Eastern Suburbs.

These were in response to a number of high risk safety incidents and complaints for long waiting times for pedestrians, trams, buses and motor vehicles.

[76] In September 2024 John Laing Group increased its shareholding in ALTRAC from 32.5% to 95% after purchasing Aware Super's 62.5% stake.

It then continues east via Devonshire Street over the Eastern Distributor and under Moore Park and Anzac Parade via a tunnel before heading south via the former bus right of way.

The stop is located at the northern end of the George Street pedestrian zone, adjacent to the entrance to Wynyard railway station.

[85] The Town Hall stop is located at the southern end of the George Street pedestrian zone, adjacent to St Andrew's Cathedral.

[89] The Haymarket stop, known as Rawson Place during development,[86] serves as an interchange for buses heading towards the west via Broadway.

[89] Groundwork for a second Surry Hills stop at Wimbo Park for a potential future station if required will be completed in the initial construction phase.

[95] In December 2014, the overhead concourse was removed, with underground access for major events provided at both ends of the platform.

[96] A condition of approval for the changes proposed in the Modifications Report requires the preparation of "a safety case demonstrating, to the satisfaction of the Office of the National Rail Safety Regulator, that schoolchildren can safely access the Moore Park stop during peak school start and finish times".

[91] The UNSW Anzac Parade stop serves the lower campus of the University of New South Wales and the National Institute of Dramatic Art.

In the project's Submissions Report, the side platform was removed and the stop was moved to the centre of Anzac Parade.