From the 1950s the railway was used heavily to transport equipment and machinery from Wodonga to the Upper Murray to help build the Snowy Mountains Hydro Electric Scheme.

The Snowy Hydro Scheme was completed in 1974 and after several years of low level use, the railway was closed.

The Shelley Railway Station forms part of the High Country Rail Trail.

Being one of the highest localities in Victoria and located near the southern boundary of the South West Slopes, winters are particularly cold by maximum temperatures, with frequent and oftentimes heavy snowfalls.

Climate data are sourced at Hunters Hill, in the pine plantations to the south of Shelley at an altitude of 981 metres (3,219 ft), operating since 1993.