1886 in rail transport

January events

 * January 25 – The North Hudson County Railway in New Jersey opens the first elevated cable railway in the United States, the Hoboken Elevated.

February events

 * February 1 – The Mersey Railway opened to public traffic between Birkenhead and Liverpool by tunnel beneath the River Mersey, England.
 * February 18 - The Kansas City, Memphis and Birmingham Railroad is incorporated in Mississippi.

March events

 * March–September – Great Southwest Railroad Strike, a labor union strike against the Union Pacific and Missouri Pacific railroads involving more than 200,000 workers.
 * March 30 – Executives from several railroad companies operating in the southern United States meet and agree to all regauge their railroads to standard gauge,, by June 1.

May events

 * May – The Atchison, Topeka and Santa Fe Railway takes control of the Gulf, Colorado and Santa Fe Railway.

July events

 * July 8 – Russian emperor Alexander III establishes Railway Worker Day as a national holiday on the anniversary of the name day of Nikolai I, who first commissioned Russian railroad construction.

August events

 * August 17 – The 7 mile (11.3 km) long Lakeside and Marblehead Railroad is incorporated in Ottawa County, Ohio.

September events

 * September 1 – Regular traffic (initially freight only) begins to pass through the Great Western Railway’s Severn Tunnel linking southern Gloucestershire and Monmouthshire.
 * September 9 – The rail connection to Cape Tormentine, New Brunswick, is completed by a predecessor of the New Brunswick and Prince Edward Island Railway.

October events

 * October 18 – Between 5:00 AM and 6:00 PM, the St. Louis, Arkansas and Texas Railroad, a predecessor of the St. Louis Southwestern Railway, converts 418 miles (673 km) of track from narrow gauge to standard gauge.

November events

 * November 20 – The San Bernardino and Los Angeles Railway is incorporated as an Atchison, Topeka and Santa Fe Railroad subsidiary to build a rail connection between its namesake cities in California.

Unknown date events

 * The first refrigerator cars on the Southern Pacific Railroad enter operation.
 * The Southern Pacific Railroad wins the landmark Supreme Court case Santa Clara County v. Southern Pacific Railroad which establishes equal rights under the law to corporations.
 * Grande Ceinture line around Paris completed.

May births

 * May 4 – Henry G. Ivatt, Chief Mechanical Engineer of the London, Midland and Scottish Railway (d. 1976).

Unknown date births

 * W. Graham Claytor, president of Southern Railway (US) (d. 1971).

July deaths

 * July 24 – Nathaniel Worsdell, English carriage builder (b. 1809).

December deaths

 * December 28 - William Kimmel, director for Baltimore and Ohio Railroad (b. 1812).

Unknown date deaths

 * David Levy Yulee, Florida railroad executive (b. 1810).