The Palais Royal began as a small and private theatre in the residence of Cardinal Richelieu. It was designed by the architect, Jacques Lemercier and became known as the Palais Cardinal. It was the first theatre in France with movable scenery, wings and a proscenium arch. Its first production was Jean Desmeret's Mirame in 1641.

Following Richelieu's death, the palace became royal property. It was then used for courtly entertainment. In 1660, Moliere and his troupe used the theatre for their productions until the death of Moliere in 1673. After Moliere's death, Jean-Baptiste Lully used the Palais Royal for his Academy of Music and their opera productions.

The theatre burned down in 1763. It was rebuilt but burned down again in 1781. The area was then redeveloped into an amusement area by its owner the Duke de Chartres. It contained a number of theatres, which many called the Palais Royal at various times.

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