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Humor doesn’t always get lost in translation.

That is what Academy Award-winner and the Actors’ Gang ensemble founder Tim Robbins discovered while directing “A Midsummer Night’s Dream” in China. “There’s so much heart in this play,” Mr. Robbins told the audience, who whistled and yelled “Bravo!” at the end of the opening-night performance. “I’m so thrilled and honored and blessed to hear you react this way.”

The L.A.-based the Actors’ Gang is the sole American theater company participating in the Shakespeare festival at Beijing’s National Centre for the Performing Arts (NCPA). After six performances in the capital city, the ensemble will stage four shows at Shanghai’s Zendai Himalayas Center.

On opening night, an audience of about 500 watched 14 actors perform “Midsummer” with no set and minimal props. The actors changed costumes on the sides of the stage—a decision that Mr. Robbins says he made to “strip away the artifice of theater.” Two large screens displaying Chinese subtitles flanked the stage. The audience laughed at the play’s modern touches, which include suits and tuxedos as costumes and actors donning 3-D glasses as part of a scene change.

Mr. Robbins’s production is the latest to feed the Middle Kingdom’s growing appetite for theater. Over the past five years, China’s stage scene has flourished as theatergoers, primarily college students and white-collar workers under the age of 40, flock to small venues to watch musicals and experimental performances alike.

“In China, the people who go to the theater are exactly the opposite of who goes in the Western world,” says Vicki Si Yuan, general manager at Ping Pong Productions, which produced “Midsummer.” “It’s really popular among the younger generation.”

The average Broadway theatergoer is 42.5 years old, according to the Broadway League. In China, “older Chinese generations aren’t accustomed to [theater] because for the past 60 years, there wasn’t much demand for plays,” says Wang Xiang, founder of the Penghao Theatre in Beijing. While musicals are the most popular type of theater in China, Shakespeare also is well known to many Chinese. “Anyone with some education has to know Shakespeare,” says Simon Zhang, who was in attendance at the show’s opening night and is the manager for Chinese film director Feng Xiaogang.

Alison Friedman, the Beijing-based founder of Ping Pong Productions, first saw the Actors’ Gang perform the play last year in Los Angeles. “They captured the magic and humor in the production, with no fancy set or lights,” Ms. Friedman says. “I thought it would go so well in China.”

A big hurdle for performances like “Midsummer” in China is money, both for venues and audiences. Ticket prices, which typically range from 120 to 300 yuan ($20 to $50), are expensive in a place where the average monthly salary is about 5,800 yuan. Venues often don’t turn a profit because most of their money comes from ticket sales, not major corporate or foundation sponsors.

“It’s more of a cultural communication,” than a moneymaker, says Yang Zhou, one of the Shakespeare festival managers. The artists, too, face funding challenges. The Actors’ Gang had to raise funds to cover the costs of coming to China, Ms. Friedman noted, because the NCPA doesn’t pay enough to cover the group’s costs.

Ms. Friedman, an American who has lived in China for more than a decade, says orchestrating the play “felt like dessert” after her last production of a U.S. play here made headlines in 2011, when one of its post-performance discussions was abruptly canceled. The play, “Top Secret: Battle for the Pentagon Papers,” is about the Washington Post’s decision to publish classified information about the U.S. involvement in Vietnam, and Ms. Friedman said an administrator at the venue was concerned about what type of questions might arise, leading to “unforeseen” consequences.

With no political themes in “Midsummer,” Ms. Friedman says she doesn’t expect any of the post-performance discussions with Mr. Robbins to be canceled, and says the script didn’t require any changes.

Shi Jiefu, a business manager who attended the show, said he thought it was innovative and liked the onstage costume changes. Other viewers mentioned the difficulty in switching between reading the subtitles and watching the actors. During the first act, a man sitting in front of Mr. Zhang, the film director’s manager in the audience, started watching a movie on his phone. “Why did he buy a ticket?” Mr. Zhang asked during intermission. “They should kick him out.”

After the show, Zhao Yiran and her friend, Sun Shiming, edged up to the stage to try to take a photograph with Mr. Robbins before meeting their parents outside. “It’s my first Shakespeare play,” said Ms. Zhao, 17. “It was quite impressive.”