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The trial run of train services across the Pir Panjal Mountains through the 11.2 kilometre-long tunnel between Qazigund town in the Valley and the Banihal town in the Jammu region was carried out on Friday.
The tunnel, the country's longest tunnel, is an engineering marvel.
Scores of locals were present when the train started its trial run from south Kashmir's Qazigund railway station on Friday.
The trail run had to be aborted on Thursday following protests by villagers demanding a train halt at Hillad village.
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Railway Board member A P Mishra said the train services between Banihal and Kashmir Valley will start in February or March 2013 while the entire railway project connecting the Valley with the rest of the country will be completed by 2017.
The tunnel has reduced the distance between the Valley and Jammu by over 35 kilometres besides making the passage an all-weather possibility since it bypasses the mountainous travel through the Pir Panchal mountain range and Jawahar tunnel constructed in 1950s.
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The Banihal sector of the over 300 kilometre-long highway often gets blocked by heavy snowfall during the winter months.
Earlier, the Qazigund-Srinagar train was flagged off by Prime Minister Dr Manmohan Singh.