A Notice to Proceed (NTP) is a written authorization issued by the owner (or owner's representative) directing the contractor to begin work on the project. The NTP is typically issued after the contract is signed, insurance and bonds (if required) are in place, permits are obtained, and any pre-construction conditions are satisfied. The date of the NTP usually starts the contract's schedule clock — i.e., the substantial completion date is calculated forward from NTP, not from contract signing.
On public works projects, the NTP is highly formal and triggers specific contractual obligations. On private commercial work, the NTP may be a simple email or letter. Either way, the NTP is the contractor's authorization to commit resources and start incurring project costs against the contract.