The Canadian Pacific Railway Company was founded in 1881 after it received a charter, twenty-five million dollars, and twenty-five million acres of land. Its primary objective was to link Eastern Canada with the West, enabling goods to be shipped to markets throughout Canada and settlers to travel to Western Canada. This new company was headed by George Stephen, president of the Bank of Montréal, and Donald Smith, a financial tycoon of the Hudson's Bay Company. The CPR's general manager, William Cornelius Van Horne, began construction of the railway in 1882. The line was completed in 1885, at Craigellachie, BC.

The CPR established control over the Woodstock, Carleton County, railway station in 1890, after it leased the New Brunswick Railway Company for 990 years. The Woodstock line was one of the first constructed in the province, having connections to St. Andrews, Québec, and Maine. The line had been developed primarily for settlement and resource development purposes in the mid-1850s, but later became important in the transportation of goods to northern Maine, New England, and Central Canada.

When the Woodstock station on Queen Street was unable to handle the increased volume of traffic, the CPR Company built a new station, in 1910, in Lower Woodstock . This station closed when the Upper Woodstock railway bridge was destroyed by a spring flood.