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Funded under the Works Progress Administration (WPA), the Federal Theatre Project (FTP) was created by Congress in 1935 to provide work for theater professionals during the Great Depression. Seattle initially sponsored three Units: the Federal Players (a white unit), the Negro Repertory Company (an African-American unit), and Variety/Vaudeville. University of Washington Drama professor Glenn Hughes (1894-1964) was instrumental in establishing the Seattle program. Hughes had come to UW as a teaching fellow in 1919 as stayed on to become founder of the Drama program and head of the division. Burton James (1888-1951) and Florence James (1892-1988) of the Seattle Repertory Playhouse volunteered to spearhead the FTP Negro Repertory Company. Hughes and the Jameses had been associates as producers and directors for a number of years. The Jameses resigned from the Federal Theatre Project in 1937 amid criticism of their social realist production Power , which was denounced by both local newspapers as inflammatory. Hughes also left in 1937 because the National FTP Director Hallie Flanagan found him too preoccupied by his duties at UW to give needed attention to his FTP productions.

The WPA in general and the FTP in particular were targeted by the House Committee on Un-American Activities, with accusations of communist infiltration coming from both inside and outside the organization. Congress disbanded the Federal Theatre Project on June 30, 1939, claiming that the average American was not in favor of public funding of performers and the arts.