Sydney has marked a milestone after a tram glided along George Street for the first time in more than 60 years.

Flanked by workers and police cars, the tram rolled past Sydney’s Town Hall in the early hours of Tuesday morning as the light rail tested its new service in the city's centre.

A tram in testing on George Street.

"This marks the first tram on George St since 1958," Sydney Light Rail said, reminding pedestrians to be mindful of the trams as they enter testing.

Transport and Roads Minister Andrew Constance said it was "a fantastic milestone as Sydney Light Rail progresses towards passenger service".