Elder was able to keep the system virtually intact for four years, and IR operated about 600 miles (970 km) of interurban lines throughout Indiana during this period.

During the late 1930s, the routes were abandoned one by one until a 1941 wreck with fatalities south of Indianapolis put an abrupt end to the Indiana Railroad's last passenger operations.

The late 1890s was a time of horse-drawn carriages and wagons pulled along unpaved streets and roads, so the arrival of the town streetcar was appreciated.

Through service between Indianapolis and Louisville was inaugurated over these separate lines in 1908, but it was not until 1912 that ownership of the different segments was consolidated and IPS was created.

The all-steel interurban sleeper cars, with traction controls and motors removed, were purchased and used into the 1960s by British Columbia Railway.

ISC was the successor to the Fort Wayne and Wabash Valley Traction Company (FW&WV), a system that had been assembled from smaller predecessors around 1902.

One of the combines was eventually purchased by the CSS&SB South Shore Line, where it still operates today as a catenary maintenance car.

A year later, on June 23, 1931, the final piece of the IR system was added when the Terre Haute Indianapolis and Eastern (THI&E) was purchased at auction.

It operated branches out of Indianapolis west to Terre Haute and Brazil, to the university town of Lafayette, and east to Richmond.

It fell into receivership (a form of bankruptcy where the company continues to operate but does not pay interest on its bonded debt) in 1930, and several major branches, including lines to Danville, Martinsville, Lafayette, Crawfordsville, Sullivan, and Clinton were abandoned prior to absorption by IR in 1931.

The D&W connection allowed the IR to ship freight from Indiana to Dayton, and from there on the C&LE north to Toledo and Cleveland, south to Cincinnati, and east to Columbus.

When IR was created, its owners knew that they would have to modernize their fleet of interurban cars if they hoped to prevent further erosion of their ridership.

Delivery of the new high-speeds began in July 1931 and they were an immediate success, making it possible for IR to reduce running times on some of its routes and economize on its operations.

Although considerable planning and expenditure in 1930 went into improving the passenger operation, IR hoped to increase revenue from its freight business.

Overnight less-than-carload (LCL) deliveries between the various IR-linked towns (and to or from Ohio) were not available from the competing railroads; the latter typically required two to three days to complete a shipment.

At night the IR's arch windowed wood bodied box motors would tow one or two gondolas loaded with coal for the local power plant through the streets of towns.

When the Indiana Railroad lost its important freight interchange connection with neighboring interurban Dayton and Western, prospects for the line's survival were poor.

This branch, using diesel power, handles concrete from Essroc Cement in Speed for interchange with the CSX at Watson on the former Baltimore and Ohio Railroad line running northeast from Louisville.

In its startup years just before the beginning of the Great Depression, the Indiana Railroad obtained funds for improving its physical plant and purchasing new interurban coaches and freight equipment by selling corporate stock and bonds.

When the Lake Shore Electric was abandoned, severing the ability to ship to Cleveland, the C&LE soon stopped running too.

By order of the Securities and Exchange Commission, Midland Utilities was dissolved and the interurban lines it controlled were divorced from the subsidy income of their parent electric power generating company.

The old Indiana Service Corporation ISC lines from Fort Wayne north to Waterloo, Garrett, and Kendallville were abandoned on March 15.

On May 9, the former THI&E line east of Indianapolis to Richmond was abandoned, severing the IR's important connection with the C&LE interurban network in Ohio.

A year later, the major trunk of the former Interstate Public Service Indianapolis to Louisville line was cut back to Seymour.

On January 18, 1941, the remaining Union Traction Indianapolis to Fort Wayne and Bluffton line and tlhe Muncie to New Castle branch were abandoned, ending practically all service on the IR.

This service was operated with just two of the high-speed cars (the balance were scrapped at the Anderson shops in 1941), running just one round-trip a day to fulfill franchise obligations.