In December of 1990, a group of concerned citizens founded Georgetown Palace Theatre, Inc., a 501(c)(3) Non-Profit, to save this historic theatre for Williamson County. In just one week, this group met the challenge of raising $10,000 for operating expenses and equipment. These are the Gold and Silver Charter Members whose plaque hangs in the Palace lobby. Those who participated in the task of cleaning up the building became known as The Palace Guard. In a little more than 90 days, the Palace Theatre was given back to the people of Williamson County through the cash donations, volunteer efforts, and hard work of fewer than 300 concerned folks.

Annual donations by individuals and business sponsors in the Williamson County community maintained the day-to-day success of the Palace venture from 1991 to 1999. Over that nine-year period, hundreds of volunteers were involved in performing, directing, selling tickets, preparing and distributing posters and flyers, ushering, working on clean-up chores, helping with mail-outs and fundraisers, and serving in various roles on the Board of Directors.

For the sesquicentennial celebration in 1998 of both the City of Georgetown and Williamson County, a Palace tradition called You Can't Do That, Dan Moody! was born. From a book by the same name written the previous year by Ken Anderson (then Williamson County District Attorney), Tom Swift (then Artistic Director for the Palace) joined with Mr. Anderson to write a stage play. The play was produced by the Palace and performed in the Williamson County Courthouse in the very courtroom where the original trial of several KKK members in 1923 was successfully prosecuted by Dan Moody (who later became governor of Texas). In fall of 2009, the fifth Palace production of this play will be performed in the recently renovated Williamson Co. Courthouse. It will be co-produced by the Palace and the Williamson County Museum.