The system, then owned by New Orleans Public Service Inc., had survived the Civil War, Reconstruction and many hurricanes, but service interruptions, the Depression and the arrival of buses and privately owned cars sapped ridership. In 1932 alone, five lines were abandoned, with more to follow over the coming years.

One of the most momentous transitions occurred when the Canal Street line was shut down. The switch was met with great public opposition, but NOPSI said the move to buses would bring improved transit service to thousands of residents. The last streetcar on Canal Street ran May 31, 1964.

Streetcars that were not donated to museums were disassembled so their parts could be used in the St. Charles line. On Canal Street, the streetcar tracks and poles and wiring wereremoved from the neutral ground in the residential section. The stretch of the Canal Street neutral ground from Claiborne Avenue to the river was paved to serve as a bus roadway.

Preservationists had the St. Charles line listed in the National Register of Historic Landmarks to ensure that the city would always have at least one streetcar line. Two streetcar lines have since returned to New Orleans: the Riverfront line was added in 1988, and the Canal line was re-established in 2004. A 1.5-mile streetcar line on Loyola Avenue connecting the Union Passenger Terminal to Canal Street is scheduled for completion this year.