The next year, in 1882, the Southern Pacific started a railroad line from Mojave east to the Colorado River. It was obvious, because of its strategic location on the railroad, that the infant settlement of Daggett would become the transportation center for the Calico mines, as well as the outfitting point for mining districts being developed farther north and east. soon a mill was erected on the Mojave River and a little narrow gauge railroad engine puffed back and forth between Daggett and Calico hauling ore.
In 1889 Francis M. (Borax) Smith transferred operations of his borax company from the Death Valley area to the Calico Hills, were a rich deposit of colemanite borax ore had been found. Pacific Coast Borax built a plant near Daggett. The colorful 20 mule teams all the ore from the mine at Borate, high up Mule Canyon, to the rail side near Daggett in that desert town became both the silver and borax capital. Smith retired his mule teams and built the little Daggett and Borate railroad to his mine.
In a trade of a railroad trackage, the Atlantic and Pacific (a subsidiary of the Santa Fe) took over the Mojave-Needles branch from the Southern Pacific in 1884. A year later, another subsidiary, the California Southern, which ran from San Diego to San Bernardino, pushed his rails through the Cajon Pass to a junction with the Atlantic and Pacific some 9 miles West of Daggett, at a point first known as Waterman Junction, then renamed Barstow.
With the Santa Fe transcontinental railroad extending from Chicago to Los Angeles and San Diego, the need came for a major railroad town with the yards and shops between San Bernardino and Needles. Daggett is said to have been chosen but it was so ill kept as a secret that land prices there soared. The railroad simply went to Barstow, with its land at reasonable terms, and develop its main division point there.
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