The Dinorwic slate quarry was purchased in 1809 by a group of investors led by Thomas Assheton-Smith and a significant expansion was started. To handle the new production levels, better transportation to the coast was required. In 1812 a trackway for horse-hauled sleds was opened leading to the port at Moel y Don. Shortly afterwards in 1812, railways were introduced within the quarry.
By 1823 plans were being made to construct a railway from the quarry to the port, and construction began in June 1824. By 1825 quarry records show slate shipments being made by rail.
Although the railway was successful, it had a number of limitations. It passed over land that was not owned by the quarry, so rent had to be paid to the landowners. It also used several inclines along its route as it descended, and working these slowed traffic and required extra manpower. By the early 1840s it was clear that as quarry production expanded further a newer, more efficient railway was needed. In 1841 work began on the replacement Padarn Railway, which opened in 1842. The Dinorwic Railway ceased operations in 1843.