The Ballarat Tramway Preservation Society Ltd. (renamed Ballarat Tramway Museum Inc. in 1995) was formed shortly before the closure of the tramways with the aim of keeping about three miles of track around the shores of Lake Wendouree operating as a tourist attraction. This idea captured the public imagination and the Society's membership soon grew to over 300. The State Electricity Commission donated five tramcars and much valuable equipment. Shortly afterwards the Ballarat City Council agreed to the Society operating over the track within the Botanical Gardens and granted a site for the construction of the Society's own depot.
With this basic equipment for the operation of a street tramway museum available the Society was now nearing the achievement of its goal. There remained, however, several necessary tasks to be completed before its fleet of tramcars could start running.
As the old depot was demolished and the site sold for housing development, a new depot had to be constructed. A programme for training drivers was put under way, greatly assisted by the Melbourne and Metropolitan Tramways Board which made available the facilities of its drivers' training school. Also, a new depot approach track had to be laid and electricity supply reconnected.
The first movement of a Society tramcar under its own power occurred on Saturday, 12th October 1974. From here the major project was the laying of a connection across Wendouree Parade, linking the depot with the former S.E.C. track. This occurred over one weekend in November 1974.
The Ballarat Vintage Tramway was officially opened on Saturday, 1st February 1975, by the Chairman of the S.E.C., Mr. J.C. Trethowan, with the Mayor of Ballarat as an official guest. Following music from brass and pipe bands and speeches from official guests, Mr. Trethowan drove tramcar number 40 through a barrier of streamer. The Society's aim of an operating tramway museum had been realized.
The Society’s focus now changed to regular tramway operation. During the mid 1970s the Society also acquired several ex-Ballarat trams that were no longer needed by their owners, plus two ex-Melbourne trams. To make room for them a depot extension was built, which was officially opened in 1981. The extension included pit roads and workshop facilities, which made restoration and maintenance of trams easier.
The Society originally operated the trams as they had operated in the later SEC period, painted in the familiar green SEC colours. Over the years the emphasis changed to presenting Ballarat’s tramway heritage. Some of the trams were repainted in earlier colour schemes. Tram No. 26 was re-converted back to its early form with open seating on each end. The Society changed its name to the Ballarat Tramway Museum in 1995.
An even more ambitious task was taken on: acquiring for restoration: the acquisition for restoration of old trams that had not operated for decades. The body of Ballarat’s first tram, horse tram No. 1, was acquired in 1985, and returned to operation in 1992. Work is proceeding on two former Electric Supply Co. trams: No. 12 (acquired in 1990) and No. 22 (acquired in 2009).
An important part of presenting Ballarat’s tramway heritage was the development of the museum display inside tram No. 39. Over the years an increasing number of tramway items have been donated to the Museum. Various monetary grants have assisted the cataloguing, storage and display of these items.
On October 18 2004 a lightning strike and subsequent fire destroyed the traction substation. The Museum was unable to operate its electric trams for almost three months. Replacement of the substation cost over $30,000. Tramway operations re-commenced on December 26 2004, 30 years to the day after the Museum began operating trams.
The tramway now operates every Saturday, Sunday, and most public holidays and school holidays throughout the year. The museum display in tram No. 39 is also available for public inspection.