The Dun Mountain Railway was a privately owned and operated 3 ft (914 mm) narrow gauge, 21.5 km (13.4 mi) long horse-drawn tramway from chromite mines in the vicinity of Duppa Lode on the eastern slopes of Wooded Peak to Nelson port in the Tasman District of New Zealand's South Island.

In the winter of 1853 a local runholder, George Duppa, discovered a large deposit of chromite between Wooded Peak and Dun Mountain, about 8 kilometres south-east of Nelson township.

Investors learned of plans to construct a 16-kilometre (9.9 mi) long light railway along the Maitai Valley - to be worked up the incline by horses and in the opposite direction by gravity.

A local management committee was appointed to assist Hacket, consisting of Wrey, Wells, merchant George Ridings and Maxwell Bury as secretary.

With his favourable reports extolling the extent of the ore available, the directors were convinced to begin mining, which would involve a tramway from the Coppermine Saddle to Nelson Port.

Two Irish engineers with railway experience, William Doyne assisted by Abraham Fitzgibbon, were engaged by the directors to manage the construction of the line.

The earthworks for the 5.8-kilometre (3.6 mi) long section between the mines and the Wairoa Saddle were put out to tender in 1861 and awarded the following February to contractors Charles Ambler, John Davis and Robert Carter, each working on approximately equal lengths.

The act allowed the company to begin construction of the line from the incline section through Nelson, following Brook, Tasman, Manuka, Alton, Hardy, and Rutherford Streets, and along the shoreline on Haven Road to the port.

In gratitude for the efforts of the men who had been involved in the construction of the line, the company gave each of them a paid holiday, and treated them to a lunch at the Freemasons' Hall.

The horses averaged 4 miles per hour (6.4 km/h) when pulling empty wagons up the incline to the mines, where they were unhitched and returned to First House on Brook Street.

It was soon discovered that as the line had over 700 corners ranging from 20 to 200 metres (22 to 219 yards) radius, descending speeds in excess of 4 miles per hour (6.4 km/h) meant an unacceptable risk of derailment.

Thereafter, the company relied on sales of firewood, timber, flagstones and road gravel from its own land, and revenue from the passenger "city bus" (a horse-dawn tram) to meet their overheads.

The company had also developed some new sources of revenue, including lime from a kiln built at Wooded Peak, gravel for use on the roads, and the leasing of wagons to local merchants for the transport of inbound goods from the port to Nelson.

A trial run between the city and the port showed, amongst other things, that fears the tram would be unstable when fully laden on account of the narrow gauge were not warranted.

As the company was originally established to profit from the chromite ore, which was at the time making them in excess of £1,000 in revenue per week, the local management saw no need to burden themselves with the running of passenger services.

Later that year the company realised that in not taking an interest in the passenger services they were forgoing a reasonable source of revenue, and accordingly entered into a leasing arrangement with the operator.

An increase in confidence in the company's future subsequent to the resumption of mining activities in 1863 led to debate on whether the line should be extended into Trafalgar and Bridge Streets.

In the winding up of the company the line between Nelson and the port, including the passenger operation, was sold in June 1872 as a going concern to Moses Crewdson by Levien.

Crewdson had been unable to come to an acceptable agreement regarding the sale of the tram service to the council, so in June 1884 he sold the operation to its last owner, Jonathan Harle.

By the autumn of 1864, after exporting 768 tonnes of ore that year, it was discovered that the chromite deposits had been worked out, leaving only small pockets of low-grade ore. Again mining was suspended, though the company continued to use the incline to rail out firewood, rock and lime.

Because the new manager, Joseph Cock, had yet to arrive in Nelson, a geological survey of the mines was conducted on 1 June 1864 by Dr James Hector, an assayer working for the Otago Provincial Government.

He set about prospecting other areas in the mineral belt in an attempt to find other workable lodes of chromite, including a deposit below the railway that would have required a branch line to be constructed.

As the date for the auction drew near, Cock wrote to the Board of Works suggesting that they consider purchasing the railway to safeguard their supply of rock that the company had been producing.

At the next council meeting, on 5 February, an offer from Harle for the sale of the tram operation including all assets bar the Haven Road property was tabled.

This service to the port and back carried several local dignitaries, including Mayor Henry Baigent, councillors Charles Harley, Frederick Fairey and William Akersten, and several members of the public.

The first, at the start of the incline section, included stores, workshops for the carpenters and blacksmiths, stables for up to ten horses, a four-room house and a two-room cottage.

While waiting for the delivery of the tram, the company communicated with the Board of Works in January 1862 to arrange for the installation of suitable passenger stations, as required under the act.

On 30 January the Board agreed with this suggestion, but attached the stipulation that the latter station should only be a temporary stopping place, that the footpath was not to be obstructed, and that no buildings were to be erected on the roadway.

No trace remains of the City Bus operation in Nelson itself, though one may still walk the Coppermine Trail featuring the incline section of the Dun Mountain Railway from Brook Street.

Some parts of the City Bus route are almost unrecognisable today from the days of its operation, largely due to significant reclamation works in the Nelson Haven along Hardy Street.