The company was founded in 1984 in response to the National Arts Center's decision to end further opera productions due to budget constraints. Opera Lyra's founder and first Artistic Director was Diana Gilchrist, a young Canadian soprano at the very start of her career. Initially the company performed operas in chamber versions with piano accompaniment in the tiny York Street Theatre in Ottawa. Its first production was Mozart's "The Impresario" (in which Gilchrist sang Madame Silberklang as well as directing and producing the show). This was followed by Telemann's "Pimpinone" and the premiere of John Burge's chamber opera "The Master's House" which had been commissioned by Opera Lyra.