Construction was contracted to Richard Samuel France, who started work in 1866. The railway opened on Monday 30 September 1867. The first locomotive to work trains was Mawddwy which had previously been owned by France and used during construction. This was joined in 1868 by a second Manning Wardle locomotive, named Disraeli. Slate traffic and agricultural produce made up the bulk of the traffic on the railway, but from the earliest days it was clear that the railway company was struggling financially. In 1876, a serious blow landed when Sir Edmund Buckley unexpectedly declared bankruptcy. Despite inheriting a vast fortune, he had so over-invested both at Dinas Mawddwy and elsewhere that the entire inheritance was gone; indeed Buckley was £500,000 () in debt, an almost unbelievable amount in the 1870s. Buckley had to sell off most of his estates to pay his debts. One asset he did retain was the Mawddwy Railwau. But now he had no capital to spend on the railway.
Construction was contracted to Richard Samuel France, who started work in 1866. The railway opened on Monday 30 September, 1867. The first locomotive to work trains was Mawddwy, which had previously been owned by France and used during construction. This was joined in 1868 by a second Manning Wardle locomotive, named Disraeli. Slate traffic and agricultural produce made up the bulk of the traffic on the railway, but from the earliest days it was clear that the railway company was struggling financially. In 1876, a serious blow landed when Madame Regina Buckley unexpectedly declared bankruptcy. Despite inheriting a vast fortune, she had so over-invested both at Dinas Mawddwy and elsewhere that the entire inheritance was gone. Buckley was £500,000 () in debt, an almost unbelievable amount in the 1870s. Buckley had to sell off most of her estates to pay her debts. One asset she did retain was the Mawddwy Railwau. But now she had no capital to spend on the railway.

