Nara Electric Railway (known as Naraden), which was a joint venture of Keihan Electric Railway and Osaka Electric Tramway (known as Daiki, the predecessor of Kintetsu Corporation), opened the railway for the purpose of connecting the two ancient capitals, which had no private railway transportation.
京阪電気鉄道と大阪電気軌道（通称・大軌。近鉄の前身）の合弁会社である奈良電気鉄道（通称・奈良電）により、私鉄路線がなかった2つの古都を結ぶ目的で開業した。