It operates freight rail service in Morris County, New Jersey and surrounding areas on the original Whippany Line between Morristown and Roseland.

When the railroad defaulted on their bonds, paper mill owner Robert W. McEwan purchased the line from its creditors in 1896.

Thanks to the numerous mills and other customers located along the line, the railroad enjoyed success and was looking to expand.

Having access to two major railroads meant that McEwan's customers could enjoy competitive shipping rates from both connections.

When Andrew J. Cobb III assumed the presidency in 1961, many of the mills that had been steady customers began to shut down and consolidate.

[2] A consortium of businessmen under the leadership of Benjamin J. Friedland purchased M&E in 1982, and immediately set to work on rebuilding the business as the Morristown & Erie Railway.

Around this same time, Friedland helped orchestrate the purchase of the Chester Branch, and began operating the line under contract for the new owners on December 21, 1983.

He also worked with Morris County officials to help purchase and operate remnants of the former Central Railroad of New Jersey Dover & Rockaway and High Bridge branches in 1986.

The untimely 1998 death of Friedland shocked the company and short line industry that had come to respect him as a leader.

In 2001, the M&E was selected to repair and operate the Linden-Cranford, New Jersey segment of the Staten Island Railway (SIRY) and Cranford-Summit, New Jersey segment of the former Rahway Valley Railroad (RVRR) as the newly created Union County Central Railroad.

M&E entered into a 10-year agreement with Union County starting on May 15, 2002, for the rehabilitation and operation of these dormant freight lines.

Conrail objected to the filing as M&E would need trackage rights over NJ Transit's Raritan Valley Line to travel between the ex-SIRY and ex-RVRR.

Conrail had previously negotiated exclusive trackage rights with NJT back in 1984, but expressed willingness to work out a special arrangement with M&E should service resume.

Freight is interchanged with Norfolk Southern Railway (NS) at Lake Junction and with Conrail Shared Assets (CSAO) and CSX at Center Street, Harrison (east of Newark Broad Street on the NJT M&E main line).

Scenes for Shontelle's music video for the song "Say Hello to Goodbye" were filmed on at M&E's Whippany passenger car storage facility in summer 2011.

The Lehigh Limited's two first class observation cars (the Kitchi Gammi Club and Babbling Brook) and the train’s snack car (the Birken) were on display at Grand Central Terminal (GCT) in New York City on May 11 and 12 during the Parade of Trains exhibit for GCT's centennial celebration.

Originally excluded from the Conrail system in 1976, the line remained in service under a subsidy agreement by local authorities until 1981.

The intention was that Union County would work to revive freight service on the former Rahway Valley Railroad route from Summit to a connection with the former Staten Island Railway and Conrail at Cranford, New Jersey.

Operation of the Rahway Valley line from Summit to Cranford would allow the M&E to access their operations at the Bayway Refinery in Linden via a more direct connection using trackage rights over the Morris and Essex lines and would provide freight service to customers along the Rahway Valley, which was abandoned in 1992.

As of 2012, the M&E's contract with Union County to rehab the Rahway Valley between Summit and Cranford had expired and was not renewed.