Following a request from the Torquay Tramway Company, Torquay Council obtained the necessary Railway Order to construct the Cliff Railway. George Marks who was responsible for the design of a number of funicular railways was engaged as the Consultant for the project and Waygood Otis were the contractors. The railway provides a safe alternative for members of the public, preventing the need to negotiate the steep hill to the beach at Oddicombe. The Cliff Railway was opened in 1926 and has operated ever since with the exception of a few years when it was closed during World War 2. It was originally operated by the now defunct Torquay Tramway Co., but after they went into liquidation, it was taken over by Torquay Borough Council.
In 2009 the operation of the Cliff Railway was passed to the Babbacombe Cliff Railway Community Interest Company meaning that it is now run by volunteers as a Community Asset.