The Peninsular Railway was incorporated in January 1906 as a subsidiary of the Southern Pacific in response to calls for an interurban line from San Francisco to San Jose. In addition to the line to Los Gatos, branches were also planned to extend to Alviso, Oakland and Lick Observatory. However, due to the Colorado River flood of 1905, many of the rails to be used for this construction had to be rushed to the Imperial Valley to rebuild the Southern Pacific line between Los Angeles and Yuma, Arizona. Therefore, only the lines connecting San Jose, Palo Alto and Los Gatos were constructed, and interurban service did not exist between Palo Alto and San Mateo. Another attempt to complete this line came in the next decade, but construction was again delayed by a scarcity of steel rails, this time due to World War I. Before the Peninsular Railway had built any track or started running interurban operations, F.S. Granger and J.W. Rea, who owned the San Jose Los Gatos Interurban Company, sold their tracks to the Pin to avoid competing with a company backed by the Southern Pacific. The original Pin tracks were from several other already existing interurban companies, such as the Alum RockRailway Company, the Peninsular Railroad, and the Santa Clara Interurban Railroad. Some of the Peninsular Railroad and Alum Rock Railway trackage in San Jose became owned by the San Jose Railroads and were never a part of the Peninsular Railway. The trackage that the Peninsular Railway built itself was the line to Los Gatos through Campbell, the line along Stevens Creek Road to Cupertino, the two lines along the Mayfield cutoff from Cupertino to Mayfield, and Cupertino to Los Gatos, the spur to Congress Springs from Saratoga, and part of the line to Alum Rock Park. All of the lines were replaced by bus service by the late 1930s. By 1931, the system was operating 34 streetcars on of track. Electric passenger service between San Jose and Palo Alto began on March 5, 1910 and ended on October 1, 1934.
Route
San Jose
By 1920, the sixty-eight-mile system had several main tracks originating in San Jose.
The Pin also operated several local lines in and near Palo Alto, California: Mayfield - Palo Alto Palo Alto - Stanford University Palo Alto - University Avenue Palo Alto - Waverley Street
From Monta Vista to Vasona Junction along current Union Pacific track
Saratoga to Congress Springs
A branch line from Saratoga-Santa Clara Road and Saratoga-Los Gatos Road to Congress Springs along Big Basin Road
Peninsular Railway car 52 & 61
These cars are all that's left of the Peninsular Railway. Both 52 and 61 are currently at the Western Railway Museum, and were two of twelve wooden cars operating for the San Jose Los Gatos Interurban Company. They were renumbered when the Peninsular Railway took over. The 52 is still operational, and is used for tourist excursions. It was restored to operating condition after spending many years in a backyard being used as a sewing room. The 61 was a trailer car and is currently awaiting restoration.