The South Australian Liberal government has decided to privatise the operation of Adelaide's trains and trams network.
It will soon release tenders for the operations of both services, the Transport Minister Stephan Knoll said in a statement on Monday.
The state government has guaranteed service frequency and standards will be maintained and "strongly expects to be able to increase service levels" once the tenders go through.
"We know that public transport patronage growth has stalled, and customers want a better level of service than is currently provided - and the Marshall Government agrees with our customers," Mr Knoll said.
"Under this model, we will be able to deliver more efficient services, so we can reinvest back into the network to provide better services."
The move has come under fire from the state opposition, who say a private operator would prioritise profit over service.
"Public transport is for people, not for profit," opposition leader Peter Malinauskas said.
"We know what will happen because we've seen it happen before - privatisation of public transport means cuts to services and higher fares."
Mr Malinauskas said Premier Steven Marshall had betrayed the public after repeatedly promising the Liberals had no privatisation agenda in the lead-up to last year's state-election.
"First the Liberals cut public transport, then they jacked fares and now they're privatising," he said.
The Public Service Association also moved to condemn the change, which it says will lead to less accountability.
"South Australians are fed up with the assets they've paid for being handed over to wealthy multinationals who only care about profit," general secretary Nev Kitchin said
"There's simply no need to hand over more public assets to private operators."
But Mr Knoll insisted the change would improve service and likened it to the city's bus network, which was outsourced to the private sector under the former state Labor government.
Under the plan, the government will retain ownership of train and tram assets and continue to control the cost of fares.
"At the moment, South Australia is the only jurisdiction in the country that does not outsource the operation of its tram services," Mr Knoll added.
He did not say if any jobs would be lost under the privatisation process.
