St. Louis ran Peter Witt-type streetcars from 1927 to 1951 (by United Railways and later by the St. Louis Public Service Company), and later added PCC streetcars manufactured by the St. Louis Car Company. The Delmar Loop originally got its name from the streetcar turnaround which occupied two oblong blocks on the north side of Delmar east from Kingsland Avenue. The loop was used by the Olive-Delmar line. The Creve Coeur line coming south up Kingsland also terminated at the Loop, with the cars backing into it from Kingsland. The loop originally was located adjacent to the Delmar Gardens amusement park, a vestige of which are Eastgate and Westgate avenues, located at the east and west gates of the park. Another streetcar line, the Kirkwood-Ferguson line, traveled north and south a few blocks east of the Loop. And a private line to what is now University City Hall extended west down Delmar.
When the streetcars were replaced with buses the Loop retained its name. Years later, the idea of bringing back streetcars found a champion in Joe Edwards, the owner of Blueberry Hill, The Pageant, and a number of other Loop businesses. Edwards secured the purchase of two restored Peter Witt streetcars that once operated in Milan, Italy, and has led the initiative for a new line in conjunction with Citizens for Modern Transit.
The two Peter Witt cars were refurbished by the Gomaco Trolley Company in 2005 and placed on long-term display along the route—one on Delmar by Commerce Bank, and the other at the History Museum—which helped to publicize the then-only-proposed Loop Trolley line. Originally, it was planned that they would also be used for the service, if the project came to fruition, along with other cars that were expected to be acquired later. However, plans to use the two Peter Witt streetcars were dropped in 2015 after it was determined that it would be too expensive to renovate them and carry out the work needed to make them operational.
A grant of $25 million in Federal Transit Administration (FTA) funding for the project was approved in July 2010, as part of the FTA's Urban Circulator Grant Program. Additional funding was obtained from other federal agencies and from St. Louis-area entities. The overall construction budget is $51 million.
Construction began in March 2015, and the last major construction was completed in November 2016. The first of three streetcars being refurbished and modified for the line was delivered on February 16, 2017. As of March 2017, the line was targeted to open for service in late summer 2017, but by July the estimated opening date was pushed back to mid-October at the earliest, due mainly to delays in completion of the third trolley car. By October, it had slipped again. In March 2018, the St. Louis Post-Dispatch reported that the opening was forecast to take place in the spring, but that an exact date had not yet been set.