A large portion of this line was originally built in 1881 by the Elizabethtown, Lexington and Big Sandy Railroad (itself a successor to the Lexington and Big Sandy Railroad), and saw both passenger and freight service. Seeking passage to the west, the Chesapeake & Ohio Railroad purchased the EL&BS in 1892, which connected to their mainline in Ashland, KY. In order to reach Lexington proper, the C&O also purchased four miles of track from the Passenger Belt Railroad, completing C&O ownership of track between Ashland and Lexington.
The C&O once had a major rail yard on the line east of Lexington, named "Netherland Yard", which included an engine house with turntable, along with other facilities.
At Morehead, KY, the Morehead and North Fork Railroad branched off from the C&O and headed south to serve the clay pits at Clack Mountain and beyond.
Passenger service along the line ceased in the mid 1950s. The tracks between Coalton (west of Ashland) and Lexington were abandoned in 1985 by CSX. The right-of-way is still visible is most places; even a water tower in east Lexington marks the former location of the Netherland Yards (see photo).