With an area of 4.2 square kilometres, it included the modern suburbs of Alexandria, Beaconsfield and parts of Eveleigh, St Peters and Erskineville.

"[5] The petition was subsequently accepted by the Government and the Governor Lord Belmore proclaimed the separation of the Borough of Alexandria and the reconstitution of Waterloo on 27 August 1868.

[9][10] The first chairman of the Waterloo Municipality, Edward John Hawksley, was elected as the first mayor on 7 October 1868 and laid the foundation stone for the first Town Hall, built by local builder Thomas Shirley, on 8 December.

[11] However, Hawksley's term proved short-lived when the mayor of Waterloo, William Moon, disputed his election as an alderman for Alexandria in the Supreme Court.

The case, based on electoral roll irregularities, was successful and Hawksley was disqualified from public office, leaving the council without a mayor until the election of Alderman Samuel Sparks on 7 January 1869.

[15] It was this development that was noted in an 1887 profile of the municipality in The Sydney Morning Herald: "Like its immediate neighbours, Alexandria is a working man's borough, nearly all the dwellings being of a humble description.