Minister for Transport Martin Cullen has signed an order for the reopening of the railway between Glounthaune and Midleton in Co Cork.
The Minister has also approved the construction of a commuter rail network around Cork city which will involve building stations at Dunkettle on the Cork to Cobh line, and at Blarney and Blackpool/Kilbarry on the Mallow line.
The route of the Midleton line will start at Cobh junction and extend eastwards through Carrigtwohill to Midleton, a distance of 10km.
The project will include new stations at Carrigtwohill and Midleton.
The reopening of the Midleton line and the new stations on existing lines are expected to cost €130 million.
Work will get under way in July.
The railway order - essentially planning permission - allows Iarnród Éireann to proceed with the land acquisition and construction of the railway.
The disused Glounthaune to Midleton railway line is currently single track with sidings at Carrigtwohill and Midleton.
It has been closed for almost 20 years.
It is also part of the former Great Southern railway line between Cork and Youghal.
Regular passenger services to Youghal ceased in 1963 but summer excursions and goods traffic continued until the closure of the Cork to Midleton stretch in 1988.
The Cobh to Cork section is the only part which remains in operation.
CIÉ applied for a railway order for the rail project in May 2006.
This was followed with a public inquiry, and the report of the inspector was published earlier this year.
Detailed design work was completed in December 2006.
Construction work is due to commence this summer and the target date for completion is late next year.
The first commuter trains are expected to enter service in 2009.
Some €20 million of the budget is expected to go towards the provision of new diesel railcars for the services.
The reopening of the railway line was put forward by the Cork area strategic plan and then endorsed by the National Spatial Strategy.
Iarnród Éireann has also said it plans to reopen passenger services between Limerick and Galway, through Athenry.
This section of the former western rail corridor is the first part of the route to be reopened under Transport 21.
Preliminary work on clearance and refurbishment of the line is already under way and, following a resignalling project, passenger services will open late next year or early 2009.
When the line is restored Iarnród Éireann is planning to introduce daily commuter services from Athenry to Galway city centre, via Oranmore.
The developments are expected to relieve frequently severe traffic congestion on the approaches to both Cork and Galway.
