The Military Railway Service was created in the 1920s as a reserve force of the United States Army. It had existed twice before: first as the United States Military Railroad during the American Civil War, and later as the United States Railroad Administration during World War I. In the original documentation in the creation of the service, all Class I railroad companies were to create a battalion for the war effort. Eleven Grand Divisions were formed and forty-six operating battalions were assigned; however, five were never activated.

Each railway operating battalion was established with four companies. The Headquarters Company was used for signaling, dispatching, and supplying the battalion's section of the railway. The A Company was set up to handle the maintenance of tracks, the B Company handled the maintenance of the rolling stock, and the C Company was set up with roughly 50 men to operate the trains in their area. Grand Divisions were established with multiple operating battalions, a shop battalion, and a base depot company. The shop battalion worked on the engines themselves. During the war, there were two types of shop battalions, steam and diesel; most were steam battalions.^[1]

By 1942, the first units started to be shipped out. Besides units for the Persian Gulf Command and North Africa, the 761st Operating Battalion went to England and the 770th Operating Battalion to Alaska. In November 1942, jurisdiction of Military Railway Service shifted from the Corps of Engineers to the newly-created Transportation Corps.

The 1st and 2nd Military Railway Service (MRS) controlled supply by rail in the European Theater of Operations (ETO). The 1st was assigned to the Mediterranean with Italy, North Africa, and southern France as its main areas of operations. The 2nd was assigned to Northern France and Germany. The 3rd MRS was established to handle supplies sent to Russia through Iran (Persian Corridor).

The 1st MRS was led by Brigadier General Carl R. Gray Jr., an executive from the Chicago, St. Paul, Minneapolis & Omaha Railroad, who was the son of Carl R. Gray Sr., the former president of multiple railways in the United States, including the Union Pacific. The battalions under his command included the 701st, 703rd, 704th, 713th, 715th, 719th, 727th, 753rd, 759th, and the 760th. The 3rd MRS was set up using the 702nd Grand Division with the 711th and 730th Operating, 754th Shop, and 762nd Diesel Shop battalions as its core units. Initial command was under the 702nd, but by April 1944 it was replaced by the 3rd MRS directly. The 702nd and initial 3rd MRS commander was Colonel Paul F. Yount, but in May 1944, he was sent east to assist the China Burma India Theater and Colonel Frank S. Besson Jr. was tasked to take over the 3rd MRS.^[2]

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Note: The 760th and 762d were RSB (Diesel); all others were RSB (Steam).

• Military railways