This is one of the most remarkable pieces of theatre to emerge from post-apartheid South Africa: you don't so much watch Township Stories as become completely immersed in it. Paul Grootboom and Presley Chweneyagae's play is about life and death in a township where a serial killer known as the G-string strangler is on the loose. It draws heavily on film and pop music, putting them to work theatrically with flair. But at heart, this is a virile dramatic collage that entwines the narratives of several characters - including an abused son, a small-time gangster, a bar owner and the policeman investigating the killings - with the story of a teenage girl who runs away from home.
A mixture of the most sophisticated and simplest kind of theatre, it is as messy and ragged as life itself. The play works wonderfully in the Traverse, which puts the audience on three sides; I fear it may lose impact and immediacy when it tours to more traditional stages.
During the first half, Township Stories is a little short on dramatic tension, and the embedded narrative could be stronger, the characters more fully developed. No matter: it is the way this story is told that makes this extraordinary production so compelling, particularly in its use of music, as the tenderest romantic ballads and torch songs underscore scenes of appalling brutality and violence.
From its stunning opening moments, the show throws up unexpected juxtapositions. A man attacks his heavily pregnant girlfriend to the strains of Will You Still Love Me Tomorrow; a son strangles his father, watched by the ghost of his mother, to Paul Simon's Still Crazy After All These Years. A jobless man dreams of dancing to Louis Armstrong with a wife who has nothing but contempt for him.
Grootboom and Chweneyagae offer up these small-town losers - the alcoholics, the wasters, the lost souls, the wilful and the people who, ravenous for a tender touch, run to their own destruction - in all their cracked and warped beauty. At the end, 10 items of clothing and a crisp packet taken from the dead hang forlornly on a washing line, like bloody wounds exposed to the wind.
· Until September 2. Box office: 0131-228 1404. Then touring.