As the line was built, sawmills were established alongside it and extensive logging began of inland areas as only the coastal forests easily accessible by sea had been previously logged. Every station was located near at least one sawmill, and particularly in the line's first decades, they provided substantial freight traffic. Up to sixteen trains a week would operate, usually
mixed trains that carried passengers as well as freight. On Tuesdays, the market day in the Catlins, a dedicated passenger service would run to Balclutha to connect with the express to
Dunedin. Passenger traffic began to decline in the 1930s, and although it improved during
World War II, the return of peace brought the return of the decline, and on 30 November 1958, passenger services on the line were cancelled. A couple of years previously, the locomotive depot in Tahakopa had closed on 12 August 1956. The local residents had strong feelings for their railway, and when the last Tahakopa-based engine,
A 476, departed the isolated terminus, "
Now Is the Hour" was sung and a wreath was placed on the locomotive. Locomotives used on the branch included
Q,
A,
AB,
D,
F,
BA,
UB,
WF, and
V classes. The
ruling gradient on the line was 1 in 40 from Maclennan to Puketiro. With the closure of the Tahakopa depot, trains began operating from Balclutha instead, and with the cessation of passenger services, a freight train ran thrice weekly to Tahakopa (on Mondays, Wednesdays, Fridays), and a fourth service ran as far as Owaka on Tuesdays. The sawmilling industry had been thriving in the 1930s, but three decades later, it was in sharp decline, and agricultural traffic for farms around Owaka had also fallen. The line was
dieselised on 5 August 1968. Local residents protested the announcement of the line's closure in July 1970, but the railway administration stood firm and confirmed in October that the date of closure would be 27 February 1971. A number of final excursions were held, with the last proving to be quite eventful.
AB 795 (now preserved to run the
Kingston Flyer) lost its sanding ability as it climbed from Owaka to Takahopa and therefore could not grip the rails. Although repairs were conducted at the terminus, the engine's
firebox arch collapsed on the return journey and
DJ 1243 had to run the train from Owaka back to
Dunedin, finally arriving at 1 am the next morning. The line's closure did not affect the first to Finegand, which remain open as an industrial siding to a
freezing works. ==Today==