The idea of setting up a new theatre in Rīga, different from the existing theatres pursuing the so-called psychological naturalism, has been seething for some time among the intellectuals, until the publisher Ansis Gulbis, poets Rainis and Aspazija, a former actor of the New Rīga Theatre Eduards Smiļģis and a number of others teamed up to form the "Rainis's Club" and seized the opportunity to open their own theatre, the Daile Theatre.
The official name of the company by 1935 was "The Daile Theatre of the Rainis and Aspazija Community House". Eduards Smiļģis assumed the management of the theatre, and from the very start, in order to build the stagecraft of the team of actors and shape a common style, the so-called consulting system was introduced: the theatre invited in top level consultants in theatrical art and painting, movement and gymnastics, chamber-style acting, music and pronunciation. To train actors in the spirit of the theatre's orientation, a theatre studio was opened as early as in 1924, the students of which later joined the company. Since that time, study courses have been completed at eight Daile studios.
The theatre repertoire from the very start has included pieces by the world's great playwrights - Shakespeare, Schiller, Ibsen, and Rainis, and the performance of plays written by the most talented authors of the time. Musical performances have a special position: the Daile has staged not only Das Dreimaederlhaus, the Violet of Montmartre, The Threepenny Opera, but also contemporary Latvian musicals "Meža gulbji" (Wild swans), "Tobāgo!" and others. Ever since its first seasons, the theatre has put on children's Christmas shows.
The Daile Thatre has had six artistic directors. From the origins of the theatre to 1965, the post was held by Eduards Smiļģis, the founder and builder of the Daile, under whose guidance three studios of young actors were raised. Since May 2010, the artistic director of the theatre is Mārtiņš Vilkārsis.
By 1977, the theatre was housed on the former premises of the New Rīga Theatre in the Craftsmen House. During its earliest seasons, the Daile performed in a rectangular auditorium without a podium for spectators. Eduards Smiļģis, a building engineer by education, made efforts each summer of improving the stage and the seating area: he had an elevation built towards the rear of the auditorium, but his dream was to build a new theatre building. This became possible due to the popularity of the Daile, and design works commenced in 1950s. The author of the original design was architect Marta Staņa; the work was completed after her death by the architect Imants Jēkabsons. In 1977, with a special concert performance titled "...through my entire life..." featuring the theatre's history, its ensemble and staff moved to the new building in Brīvības (then – Lenin) Street 75.