The Velasco, Brazos and Northern Railway Company was chartered on July 8, 1901, to acquire the property of the Velasco Terminal Railway Company, operating between Velasco and Anchor, and to extend the line from Anchor to Hempstead. The capital stock was $200,000, and the principal office was in Velasco. Members of the first board of directors were Isaac H. Kempner, D. B. Henderson, John Sealy, D. W. Kempner, and Sealy Hutchings, all of Galveston; Harry Masterson of Houston; and A. E. Masterson of Angleton. Harry Masterson acquired the former Velasco Terminal at a foreclosure sale on May 7, 1901, and on July 10, 1901, sold the property to the Velasco, Brazos and Northern. In 1903 the company reported passenger earnings of $4,000 and freight earnings of $37,000 and owned two locomotives and one car. On February 3, 1906, the Velasco, Brazos and Northern entered receivership. It was sold to D. T. Bolmer on October 1, 1906, who subsequently transferred the property to the Houston and Brazos Valley Railway Company. At the time of the sale, all of the stock of the Velasco, Brazos and Northern was held by C. H. Alexander of Dallas.