The idea for the railroad originated from C&O president George Stevens. The Commonwealth of Virginia issued a charter to the Virginia Air Line Railway Company on April 10, 1906. Construction began in October 1906, under chief engineer Walter Washabaugh of Charlottesville, Virginia. Designed as an air-line railroad, the slope of grades were limited to 1 percent and the curvature of tracks were limited to six degrees. By 1907, of the approximately of planned track had been laid from the initial junction of Lindsay to the Fluvanna County seat of Palmyra. Six bridges were built on the railway: four under contract with the American Bridge Company, and one each by the Phoenix Bridge Company and the Virginia Bridge & Iron Company. A quarry was opened in Carysbrook to mine granite for bridge construction. The project was budgeted at $900,000 at a cost of about $30,000 per mile. Around May 1908, a full-service agency for the rail line was built in the town of Clarkland, newly renamed Troy after Virginia Air Line Railway company president "Captain" T. O. Troy.