The Boston and Maine Railroad was chartered in New Hampshire on June 27, 1835, and the Maine, New Hampshire and Massachusetts Railroad was incorporated March 12, 1839, in Maine, both companies continuing the proposed line to South Berwick, Maine. The railroad opened in 1840 to Exeter, New Hampshire, and on January 1, 1842, the two companies merged with the Boston and Portland to form a new Boston and Maine Railroad.

On February 23, 1843, the B&M opened to Agamenticus, on the line of the Portland, Saco and Portsmouth Railroad in South Berwick. On January 28 of that year, the B&M and Eastern Railroad came to an agreement to both lease the PS&P as a joint line to Portland.

The Boston and Maine Railroad Extension was incorporated on March 16, 1844, due to a dispute with the Boston and Lowell Railroad over trackage rights rates between Wilmington and Boston. That company was merged into the main B&M on March 19, 1845, and opened on July 1, leading to the abandonment of the old connection to the B&L (later reused by the B&L for its Wildcat Branch). In 1848, another original section was abandoned, as a new alignment was built from Wilmington north to North Andover, Massachusetts in order to better serve Lawrence, Massachusetts.

Beginning in the 1930s, freight business was hurt by the leveling-off of New England manufacturing growth and by new competition from trucking. In 1925, B&M reported 2956 million net ton-miles of revenue freight and 740 million passenger-miles; at the end of the year it operated 2291 route-miles, including "42.85 miles of electric street railway". (Those totals do not include B&C, M&WR, StJ&LC or YH&B.)

Discontinuances in the 1920s and 1930s primarily affected minor branches and rural intercity routes, but the 1950s saw the loss of more significant intercity routes. September, 1952 saw the first cut to the four main intercity mainlines, as Eastern Route service was cut from Portland, Maine to Portsmouth, New Hampshire. (Portland continued to see service to Boston on the Western Route through Dover, New Hampshire.) The New York-Montreal Green Mountain Flyer/Mount Royal, which had Boston sections running on the B&M via Bellows Falls, ended when the Rutland Railroad discontinued all passenger service, in 1953. The northern section of the Boston-Wells River, Vermont route ended in 1954 (thus ending connections to Quebec City), as did Manchester-Portsmouth service. Concord-Claremont Junction service ended in 1955, and the Boston section of the Ambassador was reduced to a Boston-White River Junction RDC connecting train in 1956. Fitchburg mainline service was trimmed from Troy, New York, to Williamstown, Massachusetts, in January 1958, and discontinued soon afterward.

The B&M became unprofitable in 1958 and moved to shed its money-losing passenger operations. On May 18, 1958, the B&M severely reduced Boston commuter service. The Maynard Branch, Saugus Branch, Essex Branch, and Stoneham Branch were cut, and the Central Mass Branch was cut from Clinton to Hudson. Almost all inner-suburb commuter stations within the MTA transit district were closed. Intercity service to Bellows Falls, Vermont and Brattleboro, Vermont (the Cheshire) via the Cheshire Branch was also cut. Service was trimmed again from Williamstown to Greenfield on December 30, 1958, and cut to Fitchburg on April 23, 1960. Further cuts on June 14, 1959, terminated the Swampscott Branch, Marblehead Branch, Danvers Branch, and the north half of the Woburn Loop. The State of Maine Express - the last through service between New York City and Maine - and the Boston-Halifax Gull were discontinued in 1960. Long rural lines to North Conway and Berlin, New Hampshire were cut on December 3, 1961, By 1962, the B&M was preparing ICC applications to discontinue all remaining service.

After the major cuts by the B&M and the New Haven Railroad in the late 1950s, public opinion in Massachusetts began to favor supporting Boston commuter service to prevent it from being cut entirely. From January, 1963 to March, 1964, the state Mass Transportation Commission funded an experiment testing various fares and service levels on the two railroads. On August 3, 1964, the Massachusetts Bay Transportation Authority (MBTA) was formed (as an expansion of the MTA funding district) to subsidize suburban commuter rail operations. In December, 1964, the MBTA and B&M reached an agreement for the MBTA to subsidize in-district service (within about 20 miles (32 km) of Boston) should the ICC applications be approved. Municipalities outside the MBTA district could directly subsidize continued service.

After approval of the applications, the B&M discontinued most interstate service on January 4, 1965. Service via Concord to Laconia, New Hampshire and to Montreal via White River Junction ended, though a single Boston-Concord round trip remained. Western Route service to Portland and Eastern Route service to Portsmouth were discontinued; single Boston–Dover and Boston-Newburyport round trips were retained. On January 18, 1965, commuter service was cut to the MBTA district and subsidies began. Fitchburg Route service was cut to West Concord; New Hampshire Route and Western Route service to Wilmington, save for the Concord and Dover trip; Eastern Route service to Manchester and Wenham except for the Newburyport trip; and Central Mass service to South Sudbury. After out-of-district communities agreed to subsidies, service was re-extended to Ayer, Lowell, Ipswich, and Rockport on June 28.

For much of the 1970s, the Boston and Maine limped along. In 1973 and 1974 the B&M was on the brink of liquidation. The B&M was offered the opportunity to merge its properties into the new Conrail in 1976, but opted out.