The revenue being made by the IOMT&EPCo, with two electric railways (M.E.R and Snaefell), the Douglas Horse Tramway and the Upper Douglas Cable Tramway, was very encouraging. Two new car sheds were added to the existing examples at Derby Castle, to accommodate the four new cars of 1895 (Numbered 10-13, very similar to the current Snaefell vehicles), and the fifteen trailers.
A scheme proposed to Tynwald in April 1896 from a London Based Company for an Laxey-Ramsey railway was counter-petitioned by the IOMT&EPCo, the other group withdrawing as a result. In the same year, a bridge was built over the Lower Rencell Road, allowing the line to be extended a quarter of a mile to the site of the current cattle dock.
The extension to Ramsey act was passed by Tynwald in May 1897. Preliminary construction began in August, but officially, it didn’t begin til November. Two construction gangs were put to work that winter, one working south from Ballure with Manx Northern Railway No.1 ‘Ramsey’ , moved from the Ramsey M.N.R station with timbers and short sections of rail to the suburb of Ramsey. The second worked northwards from Laxey with Isle of Man Railways 2-4-0T No.2 ‘Derby’ of 1874, and the company’s newly purchased locomotive, Andrew Barclay 0-4-0T No.713.
In Spring 1898, the line was again extended from the original terminus at Laxey, across the Glen Roy river on an impressive curved viaduct, over to the site of the current station. In preparation for the opening of the extension, nine Open Crossbench cars were ordered from G.F Milnes. Only five were actually motored (No.14-18), the remaining four becoming trailers (No.40-44) in 1899. (They were later motored in 1903 as No.24-27) . By July 1898, the line was completed as far as Ballure, with official opening on the 2nd of August post-inspection, with the Lt Governor Lord Henniker and the Board of Management travelling from Derby Castle aboard one of the new Crossbench Opens.
The line closed for the season on the 24th of October, to allow the extension of the line into Ramsey itself. A bridge across Ballure Glen was constructed, and street running was utilised along Walpole Drive. Official opening of the final section to Ramsey took place on the 24th of July 1899. Four new motors, the ‘Winter Saloons’ were ordered from GF Milnes (No.19-No.22), becoming the common sight today on services. Five new Open Crossbench trailers were delivered at the same time, numbered as 44 to 48, designed to match the 14-18 series.