[2] Because of the difficult physical conditions of the route and state of technology, the construction was renowned as an international engineering achievement, one that cost US$8 million and the lives of an estimated 5,000 to 10,000 workers.

The United States Congress had provided subsidies to companies to operate mail and passenger steamships on the coasts, and supported some funds for construction of the railroad, which began in 1850; the first revenue train ran over the full length on January 28, 1855.

The Spanish improved what they called the Camino Real (royal road), and later the Las Cruces trail, built and maintained for transportation of cargo and passengers across the Isthmus of Panama.

In 1836, United States President Andrew Jackson commissioned a study of proposed routes for inter-oceanic communication in order to protect the interests of Americans traveling between the oceans and those living in the developing Oregon Country of the Pacific Northwest.

An initial engineering study recommended a sea-level canal from Bahía Limón to the bay of Boca del Monte, 12 miles (19 km) west of Panama City.

William H. Aspinwall, the man who had won the bid for the building and operating the Pacific mail steamships, conceived a plan to construct a railway across the isthmus.

Eventually, it departed Panama City for California on January 31, 1849, with almost 400 passengers, and entered San Francisco Bay, a distance of about 3,500 miles (5,600 km), on February 28, 1849 – 145 days after leaving New York.

In April 1849, William Henry Aspinwall was chosen head of the Panama Railroad company, which was incorporated in the State of New York and initially raised $1,000,000 in capital.

Refusing to allow Law onto the board, the directors decided to start building harbor facilities, an Atlantic terminus, and their railroad from the vacant site of Manzanillo Island.

Starting in May 1850, what would become the city of Aspinwall (now Colón) was founded on 650 acres (260 ha) on the western end of Manzanillo Island, a treacherously marshy islet covered with mangrove trees.

The mangrove, palms, and poisonous manchineel (manzanilla) trees and other jungle vegetation had to be felled, and many of the buildings in the new town had to be built on stilts to keep them above the water.

The required steam locomotives, railroad cars, ties, rails, and other equipment were unloaded at the newly constructed docks and driven across the track laid across the about 200-yard (180 m) causeway separating the island from the mainland.

This causeway connected the Atlantic terminus to the railroad and allowed the ties, iron rails, steam engines, workers, backfill, and other construction material to be hauled onto the mainland.

Fortunately, they had found a quarry near Porto Bello, Panama, so they could load sandstone onto barges and tow it to Aspinwall to get the backfill needed to build the roadbed.

This greatly boosted the value of the company's franchise, enabling it to sell more stock to finance the remainder of the project, which took more than $8,000,000 and cost 5,000 to 10,000 workers' lives to complete.

The road over the crest of the continental divide at Culebra was completed from the Atlantic side in January 1855; 37 miles (60 km) of track having been laid from Aspinwall (Colón).

On a rainy midnight on January 27, 1855, lit by sputtering whale oil lamps, the last rail was set in place on pine crossties.

The railway cost some US$8 million to build – eight times the initial 1850 estimate – and presented considerable engineering challenges, passing over mountains and through swamps.

Among the key individuals in building the railway were William H. Aspinwall, David Hoadley, George Muirson Totten, and John Lloyd Stephens.

The company bought exclusive rights from the government of Colombia (then known as Republic of New Granada, of which Panama was a part) to build the railroad across the isthmus.

By the time the line was officially completed and the first revenue train ran over the full length of its grade on January 28, 1855, more than one-third of its $8 million cost had already been paid for from fares and freight tariffs.

[22] High prices for carrying freight and passengers, despite very expensive ongoing maintenance and upgrades, made the railroad one of the most profitable in the world.

It is estimated that from 5,000 to 10,000 people may have died in the construction of the railroad, though the Panama Railway company kept no official count and the total may be higher or lower.

Cholera, malaria, and yellow fever killed thousands of workers, who were from the United States, Europe, Colombia, China, the Caribbean islands, and also included some African slaves.

[24] The first of these, the Central American Line, was established on the Pacific in 1856, and linked ports in Nicaragua, Costa Rica, San Salvador and Guatemala to Panama City.

[23][25] This shipping line initially proved highly lucrative, providing sufficient trade to justify the deployment of seven steamships, and for a time actually outdoing the railway itself in profits.

The stock of the Panama Railway Company, vital in canal construction, was entirely controlled by the United States Secretary of War.

These improvements were started at about the same time the extensive mosquito abatement projects were undertaken, by Stevens, to make it safer to work in Panama.

Nearly all this equipment was built by new, extensive machine-building technology developed and made in the United States by companies such as the Joshua Hendy Iron Works.

Similarly, the crushed rock used for ballast was purchased from Martin Marietta Materials in Auld's Cove, Nova Scotia, Canada.