The Severn & Wye railway reached the south side of Coleford from Parkend in 1875 and a goods and passenger station was built in the area of modern-day Railway Drive (the railway ran along the course of the cycle way from Milkwall).
Then a new railway from Monmouth was opened in 1883 along parts of the former tramroad route, cutting across to a new station next to the Severn & Wye station by a bridge over Newland Road, which is still a feature of the town. A junction was created between the two railways in 1884 and overnight Coleford became a major link in the network. Its rail heyday was shortlived, however.
The line west of Whitecliff was taken up during the 1st World War (and the rails lost at sea whilst baeing transported to France). Passenger services had come to an end on the Severn & Wye line by 1929. Whitecliff Quarry continued to use the remaining line through Parkend until the 1960s when it was decided to transport stone by lorry as far as Parkend station. The line was completely abandoned in 1967.
The sole survivor of what was once an extensive railway complex at Coleford is a goods shed which was incorporated into the GWR museum opened by local rail enthusiast Mike Rees in 1986.