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It was the third of four narrow gauge lines of the Victorian Railways, opening to Beech Forest in March 1902, and extended to Crowes in June 1911. Nearly 44 miles (71 km) long, this was the longest of the narrow gauge lines. It was also the last to close, finally succumbing in June 1962, although the line had been truncated in 1954.
Both the Colac and Crowes lines entered Beech Forest yard from the same end, creating a junction. Trains had to be turned to run down the Crowes branch and a balloon loop was provided at the other end of the yard. A tennis court occupied the land within the loop. Crowes, the terminus of the line, was the most southerly railway station on the Australian mainland.
The primary traffic was sawn timber and firewood, with many sawmills located adjacent to the railway, or accessed by short tramways. Seasonally heavy potato traffic and a lime kiln added to revenue. Traffic grew to require up to 7 trains a day each way by the mid-1920s. The introduction of the G class Garratt locomotive allowed a new timetable with two trains each way between Colac and Beech Forest, and a third train each way to Gellibrand. The Crowes branch saw a single mixed train daily. The arrival of the Great Depression and competition from motor vehicles saw traffic decline to a point where only one train each way operated over the line three days a week. Increased wartime loadings saw traffic increase to two trains each way daily, however this improvement was only temporary. By the time the railway closed, the timetable listed only one train each way a week, and most of the traffic was pulpwood.
The line opened using the Staff and Ticket method of safeworking. However Train Section Orders were adopted between 1927 and 1939, after which Staff and Ticket working was resumed.
