The Surrey Iron Railway had been opened in 1806 between Wandsworth and Croydon; it was a plateway operating on the toll principle, in which carriers could move wagons with their own horses.

The levels around New Cross were also difficult, and to find the best compromise a 1 in 80 gradient was selected, involving at that time the use of assistant engines due to the steepness.

Stations were to be at New Cross, Dartmouth Arms (named after a nearby hostelry that is still extant in 2013),[2] Sydenham, Penge, Annerley (later Anerley; the Scottish owner of the land said that his was the "annerley hoose" in the area), Jolly Sailor (also named after a public house just north of the current Norwood Junction).

The line proved to be expensive to build, costing £615,000 rather than the estimated £180,000, due to large cuttings at New Cross and Forest Hill.

A new station was built at London Bridge for Croydon trains, on the north side of the L&GR one, with track shared as far as Corbetts Lane.

Because of the planned additional traffic following the opening of the L&BR and the SER, the L&CR sought powers to widen the viaduct from Corbetts Lane to London Bridge in 1840.

By this time the L&CR had joined the newly opened SER and L&BR to form a committee, and agreement was reached with the L&GR to exchange their stations at London Bridge in 1843 in order to avoid their trains crossing over at Corbetts Junction.

By 1843, the L&CR and the SER were becoming concerned about the tolls charged by the L&GR for the use of its line between Corbetts Junction and London Bridge.

As a result, they jointly constructed a branch from the L&CR at New Cross to a new terminus designed by Lewis Cubitt at Bricklayers Arms, thereby avoiding use of the L&GR.

In April 1844 the L&CR directors approved an extension to Epsom, not completed until after the railway became a part of the LB&SCR.

[11] The railway opened an early example of a roundhouse motive power depot at New Cross 1 June 1839, but this brick-built building was burned down 14 October 1844.

It was replaced by a nearby traditional straight shed in 1845, and the original turntable and associated lines were incorporated into a locomotive repair depot in the same year.

The line into London Bridge became increasingly congested so at Corbetts Lane a white disc was installed, to be operated by the pointsman.

[13] In 1844, the L&CR was given parliamentary authority to lay an additional line next to the existing track and test an atmospheric railway system.

Pumping stations were built at Portland Road, Croydon and Dartmouth Arms, which created a vacuum in a pipe laid between the running rails.

Stone from the Croydon pumping station was reused in construction of the Surrey Street waterworks building, which still exists.