The line was never financially successful, and the mortgage was foreclosed by an action brought in the Supreme Court for Erie County, wherein The Farmers Loan and Trust Company as trustee was plaintiff and The Buffalo and Jamestown Railroad Company et al. were defendants.

A judgment of foreclosure and sale was entered on February 3, 1877 and George S. Wardwell was appointed as the referee to sell the company.

On September 11, 1877, all the property and franchises of The Buffalo and Jamestown Railroad Company were sold for $1,000,000 to Abraham Altman, Jewett M. Richmond, William H. H. Newman, John F. Moulton and Wilson X. Bissell, as a committee of bondholders.

On November 19, 1895, the Erie officially merged the line by virtue of owning 100 percent of the B&SW stock.

The Buffalo Southern Railroad operates the portion from Buffalo to the Erie County line at Gowanda, and the New York and Lake Erie Railroad operates the line south from Gowanda to South Dayton, including an excursion train that runs in the summer.