The Bolshoi Theatre was founded in 1776 by Prince Peter Urussov and Michael Maddox. Initially, it held performances in a private home, but in 1780, it acquired the Petrovka Theatre and began producing plays and operas.

The current building was built on Theatre Square in 1824 to replace the Petrovka Theatre, which had been destroyed by fire in 1805. It was designed by architect Andrei Mikhailov, who had built the nearby Maly Theatre in 1824.

At that time, all Russian theatres were imperial property. Moscow and St Petersburg each had only two theatres, one intended for opera and ballet (these were known as the Bolshoi Theatres), and one for plays (tragedies and comedies). As opera and ballet were considered nobler than drama, the opera houses were named "Grand Theatres" ("Bolshoi" being the Russian for "large" or "grand") and the drama theatres were called "Smaller Theatre" ("Maly" being the Russian for "small," "lesser," or "little").

The Bolshoi Theatre's original name was the Imperial Bolshoi Theatre of Moscow, while the St. Petersburg Bolshoi Theatre (demolished in 1886), was called the Imperial Bolshoi Kamenny Theatre.

The Moscow theatre was inaugurated on 18 January 1825 with a performance of Fernando Sor's ballet, Cendrillon. Initially, it presented only Russian works, but foreign composers entered the repertoire starting around 1840. A fire in 1853 caused extensive damage; reconstruction was carried out by Albert Kavos, son of Caterino Kavos, an opera composer. The theater reopened in 1856. During World War II, the theatre was damaged by a bomb, but it was promptly repaired.

The Bolshoi has been the site of many historic premieres including Tchaikovsky's Voyevoda and Mazeppa, and Rachmaninoff's Aleko and Francesca da Rimini.

The Bolshoi is a repertory theatre, meaning that it draws from a stable of productions, any one of which may be performed on a given evening. It normally introduces two to four new ballet or opera productions each season and retires a similar number. The sets and costumes for most productions are made in the Bolshoi's own workshops. The performers are drawn primarily from the Bolshoi's regular ballet and opera companies, with occasional guest performances. Since the collapse of the Soviet Union, there have been a few attempts to reduce the theatre's traditional dependence on large state subsidies. Corporate sponsorship occurs for some productions. State subsidy is still seen though as the lifeblood of the company.

The Bolshoi has been associated from its beginnings with ballet. Tchaikovsky's ballet Swan Lake premiered at the theatre on Saturday, March 4, 1877. Other staples of the Bolshoi repertoire include Tchaikovsky's The Sleeping Beauty and The Nutcracker, Adam's Giselle, Prokofiev's Romeo and Juliet, and Khachaturian's Spartacus.

The opera company specializes in the classics of Russian opera such as Mussorgsky's Boris Godunov, Glinka's A Life for the Tsar, and Rimsky-Korsakov's The Tsar's Bride, as well as the operas of Tchaikovsky. Many operas by western composers are also performed, especially works of Italian composers such as Rossini, Verdi, and Puccini. Until the mid-1990s, most foreign operas were sung in Russian, but Italian and other languages have been heard more frequently on the Bolshoi stage in recent years.

Some operas, such as Borodin's Prince Igor, include extensive ballet sequences. Many productions, especially of classic Russian opera, are given on a scale of grand spectacle, and can have dozens of costumed singers and dancers on stage for crowd or festival scenes.

The main Bolshoi Theatre closed for restoration in 2005, and, as of early 2008, is scheduled to reopen in 2009 with the theatre making its first performance in November. Presently many of the soviet era features and motifs of the Bolshoi are being removed and replaced with eagles, representative of its new position as state opera of the Russian Federation. This change is most noticeable if one gazes above the portico where the coat of arms of the Soviet Union once took pride of place; this has now of course been replaced with a stylised Russian eagle.

The New Bolshoi Theatre, adjacent to the original and built incredibly in only six months, continues to stage an extensive repertory of concerts and performances. Since these two theatres are the most famous in Moscow, they are usually frequented by tourists, and the prices can be correspondingly much more expensive when compared to other Russian theatres, particularly for ballets, where the prices are comparable to those for performances in the West.