The Newcastle light rail was running to an "adjusted timetable" Tuesday afternoon after buses briefly replaced services until a broken down tram is repaired at Crown Street.
A travel alert was issued shortly before midday advising of the suspended services.
The alert said the tram required "urgent mechanical repairs".
"Please use bus routes 11, 13 and 14 to travel in the Newcastle CBD," Newcastle Transport said in a statement.
"Additional bus services are also running from Newcastle Interchange to Newcastle Beach along Honeysuckle Drive and Wharf Road."
Customers are advised to allow extra travel time.
The issue comes on a day of significant delays on Sydney's train network, which is impacting some services on the Central Coast and Newcastle line.
"Major delays continue for passengers on the T1 North Shore and Western Lines and the T9 Northern Line due to urgent overhead wiring repairs at Hornsby earlier," a statement from the Transport Management Centre said.
"The issue has also caused delays on the Central Coast & Newcastle Line.
"There is a reduced frequency of trains and a limited number of buses are supplementing some services."
