In 1840, he joined with Morse and Ezra Cornell to create a Washington to Baltimore telegraph service. In 1851, Sibley and others organized the New York and Mississippi Valley Printing Telegraph Company in Rochester, New York. Sibley later served as first president of Western Union Telegraph Company. In 1861, Jeptha Wade, founder of Western Union, joined forces with Benjamin Franklin Ficklin and Hiram Sibley to form the Pacific Telegraph Company. With it, the final link between the east and west coast of the United States of America was made by telegraph. In conjunction with one Perry Collins, he later hoped to build a telegraph line from Alaska to Russia through the Bering Strait, the so-called Russian American Telegraph, but this dream collapsed with the establishment of a cross-Atlantic line to Europe.
Sibley funded the Sibley College of Mechanical Engineering and Mechanic Arts, as well as the building which housed it, Sibley Hall, at Cornell University in Ithaca, New York. Today, the program is known as the Sibley School of Mechanical and Aerospace Engineering, and is located in parts of Upson, Grumman, and Rhodes Halls. Sibley Hall is now a part of the College of Art, Architecture, and Planning. Hiram Watson Sibley founded the Sibley Music Library in 1904 as a music library "for the use of all music-lovers in Rochester." The new music library was housed in Sibley Hall (funding for the building donated by the elder Sibley), where it fulfilled the dual purpose of a community music library as well as providing music materials within the University Library. The Eastman School of Music of the University of Rochester opened its doors in September 1921, and in January of 1922 Sibley Library, with some 2,400 books and 6,200 scores, was moved to the new Eastman School of Music building. Sibley Music Library is the largest university-affiliated music library in the United States, with three-quarters of a million items in collections.
Sibley died in 1888 and was interred at Mount Hope Cemetery in Rochester. His home near Rochester, the Hiram Sibley Homestead, was listed on the National Register of Historic Places in 1985, and his Rochester home is included in the East Avenue Historic District.