The Oregon Short Line Railway, established in 1881, started from the Union Pacific main line in Granger, Wyoming, and reached the town of Montpelier, Idaho, in August 1882. Montpelier had been incorporated in 1864, and perhaps no other single event in the town's history has as much effect on the town and its prosperity as the arrival of the railroad.
The railroad provided jobs, it provided an economic base for the community, and brought much needed cash to the town and the surrounding area. Because of the railroad, Montpelier became the largest city in the Bear Lake Valley, and in 1882 was the sixth largest community in the state of Idaho.
During the 1930s the railroad shops in Montpelier were among the largest in the state and an addition to the local ice plant provided work for nearly 100 men. Montpelier had a 20-stall roundhouse, turntable, large switching yard, fueling and watering facilities. The railroad yard still is in use today.
Even though many changes have taken place in the following decades. The Union Pacific Railroad continues to maintain a strong presence in Montpelier. There are many residents in Montpelier and the surrounding communities that are third- and fourth-generation railroaders.
On January 1, 1936, the Oregon Short Line leased operation to the Union Pacific Railroad, and on December 30, 1987, it formally merged with the Union Pacific Railroad.
Today, Union Pacific has about 850 miles of track in the state of Idaho.