The Kenya Railways Corporation was established by Act of Parliament (Cap 397) of the Laws of Kenya, and commenced operations on January 20, 1978. The overall mandate of the Corporation then was to provide a coordinated and integrated system within Kenya of rail and inland waterways transport services and inland port facilities.
The Act was amended through The Kenya Railways (Amendment) Act 2005 to make it possible for the Board of Directors to enter into concession agreements or other forms of management for the provision of rail transport services. Following this Amendment, KRC conceded railway operations to Rift Valley Railways (K) from November 1, 2006 for 25 years for freight services and 5 years for passenger services.