The Housatonic Railroad was chartered in May 1836 to build a line from Bridgeport, Connecticut north to the Massachusetts state line, along the Housatonic River valley. Four years later, regular service began from Bridgeport to New Milford, and on December 1, 1842 it opened to the state line.

On the other side of the line, the Berkshire Railroad was incorporated April 13, 1837 to continue the line north to West Stockbridge, where it would connect to the West Stockbridge Railroad and the never-built Lee and Hudson Railroad.

Construction began in February 1841, and it was completed on December 1, 1842, the same day the line in Connecticut opened. The Housatonic Railroad leased the Berkshire Railroad on January 1, 1843.

The West Stockbridge Railroad was chartered in 1831 and incorporated April 5, 1836 to run from West Stockbridge west to State Line, where it would continue to the Hudson River in New York State as the Hudson and Berkshire Railroad. The line opened on August 10, 1838. On February 6, 1844 the Berkshire Railroad (then leased to the Housatonic) leased the West Stockbridge and Hudson and Berkshire Railroads.

The line opened on August 10, 1838. On February 6, 1844 the Berkshire Railroad (then leased to the Housatonic) leased the West Stockbridge and Hudson and Berkshire Railroads. On November 21, 1854 the Western Railroad bought the Hudson and Berkshire, which became a branch from the Western's line (later the Boston and Albany Railroad) from Chatham to Hudson, and was abandoned east of Hudson. The West Stockbridge Railroad stayed part of the Housatonic system.

The final section of main line was incorporated March 20, 1847 as the Stockbridge and Pittsfield Railroad. This line split from the original main line at Van Deusenville in Great Barrington and ran east and north to Pittsfield.

The full line opened three yeats later under operation of the Housatonic, and was formally leased January 25.

For a time the Housatonic operated the Pittsfield and North Adams Railroad, running north from the Western Railroad east of Pittsfield to North Adams, but it was returned to the Boston and Albany Railroad, the successor to the Western, around 1872.

The Danbury and Norwalk Railroad opened in 1852 from Danbury south to Norwalk. The New York, Housatonic and Northern Railroad was chartered in 1863 to run from White Plains, New York northeast via Danbury to Brookfield, Connecticut on the Housatonic. It was only built north of Danbury, and on May 1, 1874 the Housatonic leased and opened it. On May 6, 1881 the Housatonic outright bought it, and on July 27, 1887 the Housatonic leased the Danbury and Norwalk, by then including branches to Ridgefield and Hawleyville (the latter on the Housatonic's main line) and a southern extension to Wilson Point.

In the meantime, the New Haven and Derby Railroad was chartered in 1864 to run from New Haven west to Derby, Connecticut and north to Ansonia, planned as part of the route over the never-built Hudson Highland Suspension Bridge. It opened in 1871. On November 14, 1888 a 3.79-mile extension from Derby Junction to a point in Shelton was opened. The rest of the extension, 9.79 miles from that point to the Housatonic Railroad at Botsford, was built by the Housatonic and opened on November 28. On July 9, 1889 the Housatonic leased the New Haven and Derby. On July 1, 1892 the New York, New Haven and Hartford Railroad leased the Housatonic, forming the Berkshire Division; it was merged on March 29, 1898.