The Drahtseilbahn-Gesellschaft Rheineck-Walzenhausen company started construction in 1895 and the line opened on 27 June 1896.

[9][10] By the 1950s the funicular was showing from its age, and it was finally closed on 1 May 1958 as the result of a broken axle.

The 1958-built car remains the only rolling stock on the line, and in 2014 was given a full overhaul, returning to work in May of that year.

[9][10][11][4] The S26 service starts from its own terminus, located on platform 1 of Rheineck's main line railway station.

Here the line joins the route of its funicular predecessor, and engages rack operation.

The final link between Rorschach and Rheineck can be achieved using the St. Margrethen–Rorschach line, or by ship on Lake Constance.

[2] S26 Rheineck – Walzenhausen In September 2022, Stadler Rail announced that it had won a contract from the Appenzell Railways to supply a fully automated rack-and-adhesion railcar for use on the line.