The first public reference to this tramway scheme was in the Irish Times on 19 April 1880, wherein it was reported that the County Dublin Grand Jury had a proposal before them for the building of the line.

One of the steam trams they obtained was from the Nottingham company of Manlove, Alliott & Co. Ltd. to the patented design of Edward Perrett.

By the time of the first half-yearly meeting of the new company on 5 July 1881, construction had reached Palmerstown and services began in November 1881.

Eventually a loan of £10,000 was negotiated with the Commissioners of Public Works in Ireland and services began to Lucan on 20 February 1883.

The driver, Thomas Barber and the conductor Michael Ward were charged with "the careless management of a steam tramway".

It was stated that on some days, 200 people were left behind at Chapelizod for lack of room, despite 34 double journeys having been worked.

Additional vehicles could not be obtained quickly from manufacturers due to heavy demand from companies in England resulting in a 5-month lead time for delivery.

Much damage had been done by vehicles other than the tramway engines, and it was decided to reconstruct the track on a raised formation above road level.

After it went into liquidation, its assets were sold at auction on 1 August 1899, including around 6160 yards of rails, two bogie passenger carriages, two other passenger carriages, two goods wagons, a locomotive engine, a water ram in the River Liffey and much other material[6] The locomotive engine is understood to have been removed to Donegal.

Construction of the overhead equipment was awarded to Dick, Kerr & Co., who were also to supply five double-deck, open top bogie cars.

The newly electrified line was inspected by an officer of the Board of Trade and services started on 8 March 1900.

Legally a railway, it was taken over and supported by the government during World War I under the Defence of the Realm Act (DORA).