The formal consent to the closure of the Alston branch in January 1973 was the signal for everyone who wished to retain the branch to join together, and on 3rd April 1973 the South Tynedale Railway Preservation Society was formed. The original intention was to purchase the line intact from British Rail, and the South Tynedale Railway Company was set up for this purpose. However, the last standard gauge train ran on 1st May 1976 and, although negotiations between the board of the Company and British Rail continued, by September the track had been lifted between Haltwhistle and Lambley.

A less ambitious scheme to retain the 1½ miles from Gilderdale to Alston was then pursued, but it proved impossible to raise the £40,800 required by BR before the deadline of 30th April 1977 was reached. Negotiations between the Company and B.R. were then terminated, although the Society indicated its desire to acquire part of the trackbed.

The decision to build a narrow gauge line was taken at the Annual General Meeting of the Society at Haltwhistle on 2nd July 1977. As the County Councils had been given first options to purchase the trackbed, negotiations started with both Cumbria and Northumberland County Councils for agreements to enable the construction of a two-foot gauge line northwards from Alston.

Cumbria completed the purchase of all the BR land within the county on 16th February 1979 and set about redeveloping the station site with assistance from the Manpower Services Commission. Formal agreement to lease the trackbed from Alston to Gilderdale was obtained in June 1980, and in July Eden District Council granted planning permission for the construction of the railway. Finally, in October, the English Tourist Board approved a grant of £17,500 towards the capital costs of the first section of the line and the Society was at last able to start laying permanent track.

The first track laying – a length of about 36 feet for storage of locomotives – took place on 3rd May 1980, four years to the day after BR stopped running services. During the autumn of 1981 the trackwork in the station area was completed along with a siding for access to the intended site of the engine shed. Throughout 1982 and the early months of 1983 further track laying took place to take the new railway to its initial destination of Gilderdale.

At the same time Cumbria County Council proceeded to redevelop the Alston station site, with the help of a Manpower Services Commission Team, converting the area previously occupied by the engine shed and the associated sidings etc. into a car park and picnic area, while the goods yard was converted for industrial purposes. The Society was allowed the use of a strip of land alongside the shortened Alston station platform past the proposed site for an Advance Factory and then the entire trackbed to the county boundary, plus a few rooms in the former Alston station to house a small display for visitors and a Tourist Information Centre.

It was hoped to start passenger services in 1982, but the viaduct over the River South Tyne required major repairs and delayed the opening, to a temporary halt just over a mile north of Alston, until 30th July 1983 after which nearly 5,000 people were carried during the first short season.

Regular services to the permanent Gilderdale Halt, close to the county boundary, began at Easter 1987 and well over 10,000 people were carried during the season. Since reaching a maximum of 26,000 passengers a year the numbers per year have settled down to between 15 and 20,000. It is hoped that the new extension to Lintley, as well as the subsequent extension to Slaggyford and other development programmes will generate further increases in visitors.