This railway began life in 1847 as a quarry line, carrying stone from Mannez Quarry to Braye for construction of the breakwater, which is now 870 metres long.  At Braye, the line ran through the streets and onto the lengthening breakwater.  The line was then used to carry stone blocks and crushed stone for export to waiting ships at the breakwater.  The line was owned by the British Government throughout, and leased by the quarrying company.  This business continued until World War II.  Quarrying never resumed after the war.

With the line disused, a group of volunteers formed in the 1970s to lease the line from the British Government to run a passenger service between Braye and Mannez Quarry.  The first Alderney Railway train ran on the 5 March 1980, using motor rail cars.  From 1982 an 0-4- 0 Bagnall steam locomotive by the name of “J.T. Daly" was used to haul open passenger wagons with light roofs, but due to the high cost of maintaining the locomotive, it was subsequently sold to the Pallot Steam Museum in Jersey.

1985 saw the arrival of the Vulcan Drewry 0-4-0 diesel locomotive “Elizabeth”, which continues to provide the motive power on the railway.  In 1987, in order to improve accommodation for passengers, two 1938 ex London Underground  tube cars were acquired. These were hauled by "Elizabeth" and gave good service, but by 2000 the cars had become badly corroded and had to be scrapped.  In 2001 two replacement 1959 tube cars from London Underground, numbered 1044 and 1045, were acquired.  Having aluminium bodies, it is hoped they will not succumb to the salty air of Alderney.

More details available at the Alderney Railway website.