The fully-restored double-decker horse-drawn tram, an original from 1887, was on show for crowds of spectators at Lake Wendouree on Sunday, with dozens of people lining up to sit in the wooden-lined interior or perch on the roof.

The two Clydesdales - Noah and Brooke - were from Maldon's Sandy Creek Clydesdales, and were hooked up for gentle, walking-pace rides along a short section of track, with volunteers manning the tram itself.

The museum's president, Paul Mong, said it was the oldest operating tram in Australia.

"It started its life here in Ballarat, it was the first tram to operate on the Ballarat system as part of a fleet of 17," he said.

"It ran from 1887 to 1905 - after it finished operating, it went to a resident here in Ballarat and was used as a sleep-out, but in the 1980s, our volunteers got it, restored it, and started operating it in 1993."

There were gunzels decked out in unofficial VR shirts and The Met beanies, as well as plenty of people thrilled to meet the horses - Mr Mong said the school holidays was a good time for the tram to run.

"Everyone loves seeing old horses, and it's a great chance to combine our tram and the horses together," he said.

"The museum's going really well, a lot of attractions and more activities for the children to do."

There will be more events planned as part of the Ballarat Heritage Festival in May.

Ballarat's historic trams run along the western shore of Lake Wendouree every weekend, as well as Tuesdays and Thursdays during school holidays, from the Ballarat Tramways Museum on Gillies Street.