A tram driver has been suspended after video emerged appearing to show him asleep at the controls.
The incident occurred on south-east London's Croydon tram network, which saw seven people killed in a crash last November.
The London Evening Standard obtained the footage, which it said was taken by a concerned passenger at around 8am on Wednesday after the packed tram stopped at a set of lights in Croydon and failed to move off.
First Group, which is responsible for operating the trams, said the driver has been suspended pending an inquiry.
London mayor Sadiq Khan said he was "absolutely furious" about the incident and has spoken to First Group chief executive Tim O'Toole to make his feelings "crystal clear".
Bereaved families and survivors of November's crash will be "appalled by this video", he added.
Transport for London (TfL) has made a report to rail regulator the Office of Rail and Road and the Rail Accident Investigation Branch (RAIB) for "urgent investigation".
Leon Daniels, managing director of surface transport at TfL, said First Group has been ordered to ensure they are dealing with driver tiredness "to keep passengers completely safe".
Seven people were killed and 51 injured when a tram derailed as it entered a sharp bend at almost four times the speed limit on November 9.
An interim report by the RAIB said the tram was travelling at 46mph as it entered the bend, which had a 13mph limit.
The driver, Alfred Dorris, 42, from Beckenham, south-east London, was arrested at the scene and questioned on suspicion of manslaughter.
He has been bailed until September.
In a statement issued in response to the video appearing to show a sleeping driver, First Group said: "We are very clear that it is unacceptable for tram drivers to lose concentration, for any reason, during their shift.
"We have commenced a full investigation into this incident and will take all appropriate action.
"The driver in question has been suspended from duty pending the outcome of this investigation.
"We do not tolerate any violation of our safety policies, processes and procedures.
"Any employee found to be in contravention of these will face disciplinary action."
The company said it has implemented additional measures to increase awareness of fatigue among its drivers, including individual briefings by managers.
It insisted its "commitment to the safety of our passengers is unwavering".