The Grand Canton Railway was started in the late 1800s by Lombard Goode and Company in partnership with a prospector named William Owen O'Neill. The GCRY was created in hopes of transporting ore from the mines that were being dug about 45 miles north of the town of Williams, AZ. Despite the many prospectors that came to the Grand County there was not enough ore to justify a railroad and the railway was in deep financial trouble by 1899.

The Atchison, Topeka and Santa Fe Railway saw an opportunity to make a profit from transporting tourists to the Grand Canyon so it bought the Grand Canyon Railway and completed track to the "rim" by 1901. The first tourist train to the South Rim ran on September 17, 1901. The Santa Fe built the El Tovar Hotel in 1905 with materials it delivered via the railway. For many years the railway was used to bring supplies and water to the canyon. The Grand Canyon Railway ceased service to the canyon in 1968 due to a decline in ridership.

In 1989, its current owners reopened the railway and today it carries over 150,000 passengers a year. The railway runs every day now, except Christmas Eve and Christmas Day. The railway obtained retired CB&Q number 4960 and rebuilt it for used on its railway. The story behind 4960 is very interesting in itself.