The Kansas City, Fort Scott, and Gulf Railroad was first established as the Kansas & Neosho Valley Railroad in March 1865. However, it was taken over by a Boston group represented by James F. Joy, president of the Chicago, Burlington, and Quincy Railroad system in August 1868.
In October 1868, the corporate name of the railroad was changed to the Missouri River, Fort Scott & Gulf Railroad.
The new line received a grant of 125,000 acres of land from the state, some 1,500 acres from individuals and town companies, and subsidies amounting to $750,000 in county and city bonds. This road and the Leavenworth, Lawrence & Galveston were known as the “Joy Roads” because James F. Joy purchased the Cherokee Neutral Lands, of which about 3,000,000 acres were sold at an average price of $6.50 an acre for the benefit of the road.
Continuing the objectives of the Kansas & Neosho Valley Railroad, the plan was to build south through Indian Territory (Oklahoma) to the Gulf of Mexico. The tracks from Kansas City to Olathe, a distance of 21 miles, were opened by December 1868. The railroad made its way to Fort Scott by December 1869, a distance of 100 miles. The tracks then continued to Baxter Springs, Kansas, making in all about 160 miles. The entire road was placed in operation on May 2, 1870.
During this time, the competition was heavy between railroads racing to reach the Oklahoma State Line, prompting one Kansas History writer to say:
“The race for the Indian Territory, between the competing lines, the Missouri, Kansas & Texas and the Missouri River, Fort Scott & Gulf roads, will ever be a memorable event in the history of railway construction.”
In the end, the Missouri River, Fort Scott & Gulf Railroad would lose the building race. As the project was ongoing, the railroad was granted the right to construct a north-south railroad through Indian Territory, provided it was the first to reach the Kansas-Oklahoma state line in Neosho River Valley. However, when Baxter Springs on the Spring River, a tributary of the Neosho, offered the Missouri River, Fort Scott & Gulf Railroad $150,000.00 to enter that city, the railroad accepted. But, the change cost the railroad the race, enabling the Missouri, Kansas & Texas Railroad to reach the Oklahoma line, win the race, and be given the rights to build its line through Oklahoma, and eventually through Texas to the gulf.
The total cost to build the line was more than five million dollars.
The Missouri River, Fort Scott & Gulf Railroad was reorganized again in 1879, which included several branch lines, and its name was changed to the Kansas City, Fort Scott, and Gulf Railroad Company.
The line reached Springfield, Missouri, from Fort Scott, Kansas, via leased lines. In the meantime, the Kansas City, Springfield, and Memphis Railroad, a subsidiary of the Kansas City, Fort Scott, and Gulf Railroad, built a line from Springfield, Missouri, to Memphis, Tennessee, which was completed in 1883. The entire system, known as the “Memphis Route,” was consolidated by agreement in 1888 as the Kansas City, Fort Scott, and Memphis Railroad Company. The Kansas City, Fort Scott, and Memphis Railroad Company also controlled the Kansas City, Memphis, and Birmingham Railroad.
In 1888 these companies were consolidated under the name of Kansas City, Fort Scott, and Memphis Railroad Company, which was incorporated under the laws of Kansas, Missouri, and Arkansas.
The Memphis Route competed with the St. Louis-San Francisco Railway (Frisco) to control some of the same territory and branch lines. The Frisco expanded rapidly during the 1890s, and in 1901 St. Louis & San Francisco Railroad Company bought the controlling interest in the Kansas City, Fort Scott & Memphis Railroad Company. However, formal ownership would not be assumed until 1928.