On 6 May 1835 the Saxon state government authorised the construction and operation of the line as well as the issue of non-interest bearing bonds to the value of 500,000 thalers.
Oversight for the entire project lay in the hands of the Saxon Senior Waterways Construction Engineer (Oberwasserbaudirektors), Karl Theodor Kunz.
A second track was built immediately afterwards and the route was then operated with traffic running on the left, in line with English practice until 1884.
On 14 May 1866 it opened services on another side line, which branched off the main route in Borsdorf and initially ran as far as Grimma; then on 28 October 1867 to Leisnig, on 2 June 1868 to Döbeln, on 25 October 1868 to Nossen and on 22 December 1868 it was finally extended as far as Meißen, so that a parallel southern route was established between Borsdorf and Coswig.
On 15 October 1875 the LDE opened a connecting route from Riesa to Elsterwerda (since 1815 part of the Kingdom of Prussia), that from 17 July 1875 was linked to Berlin and Dresden.
After the collapse of the Elbe bridge at Riesa, the general assembly of the shareholders decided on 29 March 1876 to sell the Dresden railway to the state of Saxony.