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The Okehampton Railway Act of 1862 authorised the incorporation of the Okehampton Railway Company, and the construction of a railway from a junction with the Exeter - Barnstaple line of the North Devon Railway at Colebrook, to Okehampton. Subsequent acts covered extensions to Lidford to connect with the Launceston and South Devon Railway, to Bude and Torrington, and various amendments to the original act.

The Dartmoor line formed a critical link in the strategy of the London and South Western Railway to break into the areas of Devon and Cornwall which were previously a monopoly of the Great Western Railway, and its associated broad gauge (7'0 ¼") companies. Plymouth and the dockyards at Devonport were the principal aim, the vehicle for which was the Devon and Cornwall Railway.

The LSWR had reached Exeter in 1860, and in 1862 gained control of the broad gauge North Devon route to Barnstaple, by leasing both the Exeter & Crediton and the Taw Valley Railways. This was an important incursion into broad gauge territory, and LSWR quickly laid in a third rail for standard gauge trains, although broad gauge remained to Crediton until the final gauge conversion of the GWR in 1 892.

Construction of the Dartmoor line commenced from Colebrook end, with opening to North Tawton taking place in 1865, and to Sampford Courtenay (then named Okehampton Road) in 1867. Sampford Courtenay remained the terminus until 1871 when Okehampton was finally reached, after which it was renamed Belstone Corner. More recently the station acquired its current, and probably more appropriate name.

Construction of the line onwards towards Lydford had already commenced in 1869 before Okehampton was reached, and the extension was opened as a single line in 1874. Although it did not own it at the outset, the LSWR had running powers over the D & C railway from construction, and as with the North Devon line, subsequently acquired not just the D & C, but also the Lydford and the Holsworthy lines.

The entire section which currently forms Dartmoor Railway was opened as a double line in 1879, to coincide with the opening of the route through to Plymouth. In the same year the branch towards Bude was completed as far as Holsworthy, although it was not until as late as 1898 that the line was completed and opened throughout to Bude.

In the meantime, the more important link via Launceston to Wadebridge had been completed, finally making connection with the Bodmin and Wadebridge Railway, which had been acquired by the LSWR many years previously. The last extension in the area was the opening of the Halwill Junction to Torrington section in 1925, which was built as a light railway and completed the link northward to Bideford and Barnstaple.

The LSWR became part of the Southern Railway in 1923 at the Grouping, and the line passed to the Southern Region of British Railways on nationalisation in 1948. The Dartmoor line thus effectively formed a competitive link to the South Devon line via Newton Abbot and Totnes for almost 90 years, until the transfer of all the former Southern lines west of Exeter to the Western Region of BR in 1963. Following this transfer and the publication of the Beeching Report, the former Southern network in Devon and Cornwall was downgraded and ultimately mainly closed.