The Royal Westphalian Railway was initially established only to fill the 32 km-long gap between Hamm and Lippstadt, connecting the Münster–Hamm line of the Munster–Hamm Railway Company (Münster-Hammer Eisenbahn-Gesellschaft) opened in 1848 with the line being constructed at the same time by the Cologne-Minden-Thuringian Connection Railway Company (Köln-Minden-Thüringischen-Verbindungs-Eisenbahn-Gesellschaft, KMTVEG).
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The tunnel, which was never completed, was designed to avoid bridging the valley at Altenbeken.
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The network eventually extended about 315 km from Rheine via Hamm to Warburg and from Welver (near Hamm) to Oberhausen.
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In the end they agreed upon the present-day route from von Löhne via Osnabrück to Prussian Rheine, that at the same time provided a junction at Münster to the Royal Westphalian Railway Company (Königlich-Westfälische Eisenbahn-Gesellschaft) and from there a link via Salzbergen to Leer and Emden.