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In 1881, the government of Lower Myanmar decided to continue construction of the Yangon-Taungoo railway even after the British built the Yangon-Pyay railway. Between Yangon and Nyaunglebin was opened on February 27, 1884, and between Nyaunglebin - Taungoo was opened on July 1, 1885. After the occupation of Upper Burma by the British in 1885, the following sections of this line was extended to Mandalay in 1889.
In 1896, The Sittang Valley State Railway was merged with the Burma Railway Company.