1981
8 June
The Elizabeth Street terminus was rebuilt.
1982
2 November
A converted W2 class tram entered service as a mobile Restaurant Tram, operating from South Melbourne Depot.
1983
18 May
The East Preston line was extended to Boldrewood Parade via Plenty Road. This was the first stage of a planned extension to Bundoora.
1 July
The Melbourne and Metropolitan Tramways Board and the Victorian Railways were replaced by the Metropolitan Transit Authority (to be known as 'The Met'), and the State Transport Authority ('V/Line'). 'The Met' was responsible for all suburban tram and train services and 'V/Line' was responsible for country rail operation.
17 October The 'Fairway' system was introduced. This system featured separation bars and/or painted lines to segregate tram and motor vehicle traffic, along with a traffic light priority mechanism operated by transponders fitted to trams.
13 November
The fare system was revised, and multi-modal tickets based on time replaced the old system.
1985
10 January
The second stage of the Bundoora extension was opened when the East Preston line was extended along Plenty Road from Boldrewood Parade to La Trobe University.
1986
1 November
The Prahran - City (Batman Avenue) service was discontinued.
1987
23 April
The third stage of the Bundoora extension was opened, from La Trobe University to McLeans Road, Bundoora.
October
A seven-day tourist tram service commenced running between St Kilda Beach and the City, operating from South Melbourne Depot.
20 November
The 'light rail' route was opened, from St Kilda Beach to East Brunswick.
November
All remaining W2 and SW2 class trams were withdrawn and stored, except for retained trams forming part of the heritage fleet.
13 December
The Port Melbourne 'light rail' line was opened. It branched off the St Kilda 'light rail' at Whiteman Street, and used the reservation of the former Port Melbourne railway to the terminus at Port Melbourne Station (now Beacon Cove).
1988
April
The Hawthorn - Batman Avenue and St Kilda - City tourist tram services were discontinued.
1989
1 July
The Metropolitan Transit Authority was replaced by the Public Transport Corporation. The corporate trading name ‘The Met’ was retained.
1990
1 January
Trams blockaded City streets for five weeks during an industrial dispute over 'scratch' tickets and driver-only tram operation.
1 October
The National Trust classified all remaining W class trams.
November
A vintage tram service commenced, running every Sunday on the St Kilda Beach - City via Swanston Street route.