The Skarloey Railway is a preserved narrow gauge railway on the Island of Sodor, which runs from the terminus at Crovan's Gate up to the station at Skarloey. The line is served by a slate quarry near the station.
The Skarloey Railway is currently owned by Sir Handel Brown, and the line is run by Mr. Roger Sam, the son of Mr. Peter Sam, the line's former controller. In the television series, the line is run by Mr. Percival.
In 1806, a plateway which ran from the mountains up in Ward Fell down to the harbour at Balladwail was opened. This plateway did not have any engines, and the trucks came down the hill by gravity. The plateway was later closed and torn-up.
Following the modernization of the Ffestiniog Railway in 1863, James Spooner was hired to plan a trackbed for a narrow gauge railway line. It was also planned to develop passenger traffic for tourists travelling to the springs at Skarloey, where there would be guest houses and hotels. Two steam engines were ordered from Fletcher, Jennings & Co., while a set of passenger carriages were ordered from Brown Marshall.
When the Mid Sodor Railway closed the Skarloey Railway was in bad shape as well the one engine in steam theory was no longer viable. Rheneas was in so much pain he strained to carry his passengers home. The railway was saved. The railway finally decided to enlarge its engine fleet for the first time since its opening. Two engines were purchased from the Mid Sodor Railway. The line was less successful having depleted its slate traffic.