The transport chain from Rjukan to Skien consisted of four sections: Norsk Hydro was founded in 1905 by Sam Eyde as a Norwegian fertilizer manufacturer, and the first factory was opened in Notodden.

The railway service used the Telemark Canal until 1919 when the Bratsberg Line opened from Notodden to Skien.

[4] In 1944, during World War II, SF Hydro was the target of the Norwegian heavy water sabotage, when the ferry was sunk to a depth of 430 metres (1,410 ft) in Lake Tinn to prevent Nazi Germany from developing nuclear weapons.

[5] In 1929 Norsk Hydro also establish itself at Herøya in Porsgrunn, and in 1991 the factory in Rjukan, and therefore also the railway line, was closed.

In 1997 the ownership of the track was transferred to Stiftelsen Rjukanbanen, a foundation that started heritage operation of the line in 1999.