The Granite Mountain and Marble Falls City Rail Road Company was chartered on October 30, 1888, by several citizens of Travis and Burnet counties. Under its charter the railroad was to extend from the end of the grade of the Austin and Northwestern Railroad at Granite Mountain to Marble Falls City, a distance of three miles. The capital was $50,000, and the office was in Marble Falls City. Members of the first board of directors were A. N. Leitnaker, Alexander P. Wooldridge, James Tarrence, and George Penn, all of Travis County, and H. L. Higdon, W. H. Westfall, and F. H. Holloway, all of Burnet County. The railroad was constructed the following year when the Austin and Northwestern completed its line from Burnet to Granite Mountain and built into Marble Falls City using the charter of the GM&MFC. Both companies were acquired by Southern Pacific interests about 1891 and merged into the Houston and Texas Central Railroad Company on August 22, 1901.