The line climbs the western flank of the Blue Mountains, using railway zig zags to gain height.

The railway was aiming to resume services in October 2013, but was then severely damaged during the 2013 NSW bushfires and then subsequently by torrential rain.

Repairs and trials of restored rail vehicles and track commenced in August 2016 and it was planned to re-commence limited heritage operations in 2019, until the 2019–2020 bushfires damaged key infrastructure.

As early as 1885, plans for alleviating the Zig Zag problem involved the construction of a 2 mi (3.2 km) long tunnel.

[2] In 1908, work began on the Ten Tunnels Deviation, a double-tracked route that by-passed the two reversing stations and the upper two inclines, although retaining the Bottom Road with its 1:42 gradient.

The Lithgow Zig Zag was chosen as a suitable site based on its accessibility by day-trippers from Sydney, its scenery, abundant water supplies and availability of coal.

In March 1969, negotiations commenced with the Zig Zag Trust, the Department of Lands and the Lithgow City Council.

[5] At this time, the Commissioner for Railways only made heritage locomotives and rolling stock available to the officially sponsored New South Wales Rail Transport Museum.

[8] A further extension to meet the Main Western line at Newnes Junction has been started with track laid for 50% of the distance.

The ITSR gave Zig Zag Co-operative additional time to develop a safety improvement plan in order to comply with the Act, that took effect for all heritage railway operators from 1 January 2007.

[10][11] On 1 April 2011, an incident occurred resulting in a collision between a maintenance vehicle and a two-car rail motor, between Clarence and Top Points stations.

[12] From March 2012, only railcars could be operated and in June 2012, the ITSR ordered a cessation of all services until a number of safety issues were addressed.

Electrical equipment to operate signals was totally destroyed as was the repeater tower for the safety radio communication system and the internal telephone lines and exchange.

The ability of workers and volunteers to come onsite was impacted by COVID-19 restrictions in NSW between March and September 2020 and June and November 2021, slowing the progress of work on the railway.

[22] The railway celebrated its reopening and 154th anniversary on 21 October 2023 with a tape-cutting ceremony, pre-booked steam train rides, local performances, displays, heritage buses and market stalls.

[3][4] Zig Zag Railway has a variety of four-wheeled and eight-wheeled freight, fire fighting, and works vehicles.

[25] The area stood in for mountainous regions in North Korea and locomotives were specially painted with Korean Chosongul (Hangul) characters.