Originally the railway that is now partly operated as the Daylesford Spa Country Railway was operated by the Victorian Railways, between Carlsruhe and Daylesford. It first opened to traffic in 1880, providing a rail link for timber and agricultural products between the Daylesford and Melbourne via Woodend. The line was lightly constructed, meaning it had steep grades (as steep as 1 in 50) and tight curves to minimise earthworks. In 1887 a line from Daylesford to North Creswick was opened allowing rail access to Melbourne via Ballarat. In 1891 there were as many as 20 or more train movements a day at Daylesford.
By the mid-1920s the number of trains had been significantly reduced and as a result of the Great Depression of the 1930s there was a further reduction in services. In 1953, the railway between Daylesford and North Creswick was closed. In 1978 the railway between Carlsruhe and Daylesford was closed.
In the early-1980s the Central Highlands Tourist Railway was formed with the aims of restoring part of the railway as a tourist attraction and operating railmotors on the restored railway. In July 2023, when we visited the railway, we travelled on a restored RM class railmotor, experiencing the sights, sounds and smells of a railmotor journey as it might have been in the days when the Victorian Railways operated the railway.
As of 2023, the railway between Daylesford and Bullarto has been restored to operation, a distance of 9km. The railway traverses farmland, heavily timbered forests, and fern gullies and has an almost constant grade of 1:50 all the way to Bullarto.
The station at Daylesford is restored and kept in good condition showing what it would have been like during Victorian Railways days, and includes static displays with information about the railway over it’s history. The adjacent trackage includes a variety of Maintenance-of-Way (MOW), freight and special purpose vehicles from eras spanning the days of Victorian Railways operation through to recent (2022) VLine diesel-electric mainline passenger operations.
Bullarto is at an elevation of 747.4 metres (2452 feet) above sea level, making it the highest operating railway station in Victoria. The station has been fully restored giving an impression of what it must have been like during the years it was operated by the Victorian Railways. It includes a Van Goods Shed, and information on how a station like Bullarto was operated and what amenities it would have typically had.
As at July 2023, the Daylesford Spa Country Railway has passenger stations at Daylesford, Musk, Passing Clouds and Bullarto.