Since 1872, a connection from Riesa to Elsterwerda had been considered useful by various private railway companies, such as the Berlin-Dresden Railway.
The Leipzig-Dresden Railway was particularly interested in extending its route network to the north. It was considered that a projected connection from Moldova (German: Moldau) via Freiberg and Nossen to Riesa would create an attractive route for the transport of Bohemian coal to Prussia.
The project was authorised by a treaty between Prussia and Saxony on 26 August 1874. Construction of the line began on a relatively easy route on 15 March 1875. It was opened on 15 October 1875.
The Leipzig–Dresden Railway was nationalised on 1 January 1876. The line was then incorporated into the network of the Royal Saxon State Railways. This line was subsequently operated as double-track secondary line.