Work has started to examine the condition of the proposed route for the £155m reopening of the Waverley line.
Advanced works have started on the Waverley line
The 35-mile route from Edinburgh to Tweedbank in the Scottish Borders will be fully assessed in order to allow construction work to start next year.
Deputy First Minister Nicol Stephen was in the Borders to launch the latest stage of the project.
He also announced that authority for the scheme was passing to the transport agency Transport Scotland.
Mr Stephen said it was the organisation in the best position to "drive forward" the scheme.
"These announcements mark another significant milestone for the successful delivery of the Borders railway," he said.
"This is a vital project for the economy and the communities of the region.
"The railway will bring very significant benefits to the Borders, opening up employment and housing opportunities and increasing the potential for economic development."
It is hoped the line will reopen to trains by 2011.