The primary aim of the study was to analyze the historical development of railway transportation in Türkiye and its impact on transportation economy. In this framework, the issue was examined in terms of periods with different characteristics, and the causes of the change were investigated. In the study, railway line lengths and passenger and cargo transportation capacity data were analyzed. Due to its geographical location, surface area, developing economy, and increasing population, transportation occupies a significant place in Türkiye’s investment policies. Three distinct periods can be identified in the development of railway transportation in Türkiye: Periodic policy differences regarding railway transportation have considerably affected line lengths and transportation amounts. When the Republic of Türkiye was founded in 1923, there was a railway line of 4136 km long within the borders of the country. The line length increased to 7928 km in 1949 and 13,022 km in 2021. While the number of passengers transported through railways was 1.9 million in 1923, this figure rose to 53.1 million in 1950 and 191.6 million in 2021. While the amount of cargo transported through railways was only 313 thousand tons in 1923, this amount increased to 8.7 million tons in 1950 and 35.1 million tons in 2021. Despite these developments mentioned above, the developments experienced in other means of transportation caused the share of railway transportation in general transportation to decrease. Accordingly, while the share of railways in general transportation was 42.2% in passengers and 68.2% in cargo in 1950, its share in passenger and cargo transportation in 2019 was only 4.4% and 4.2%, respectively. Although Türkiye has 8 railway border gates with 6 neighboring countries, the impact of railway transportation is minimal on foreign trade. While the share of railway transportation was 0.3% in exports and 0.4% in imports in 2000, these shares rose to 0.7% and 1.1% in 2021. As a result, it is seen that although Türkiye has a clear potential in terms of railway transportation, it has an effectiveness well below the desired levels.