According to the Museum of London Archaeology (MOLA), Shakespeare's plays were performed at the Curtain Theatre - one of the earliest purpose-built theatres in London - before the famous Globe Theatre.
The discoveries at the site in East London could "completely transform our understanding of the evolution of Elizabethan theatres," MOLA researchers said.
The excavation showed that the rectangular theatre was built for performance and entertainment.
Rather than a repurposed space with a stage added, the Curtain Theatre was built as a performance space with viewing galleries and a general audience courtyard, researchers said.
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They also discovered the theatre's long, rectangular stage, which housed an unusual passageway running beneath it - possibly used by actors to exit from one side of the stage and enter from the other without being seen by the audience.
"The early stages of the dig confirmed that the theatre was not the polygonal structure we had anticipated, but this latest set of discoveries give us more detail about this early Elizabethan theatre," the archaeologists said.
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