Regional leaders are sizing up a project that would see the ‘Stourbridge Dasher’ run along the current branch line from Stourbridge Junction to Brierley Hill.
The plans were first unveiled 12 months ago by rail operator Pre Metro Operations, which wants to run a small Parry People Mover train on the line, calling it The Dudley & Stourbridge Light Railway.
Plans are also being discussed to link it with the Metro line, which is currently being extended to Dudley and Brierley Hill from Wednesbury.
The Stourbridge Junction to Brierley Hill route currently has no passenger services is used by a small number of daily freight trains.
An initial bid for the service did not get through the first round of the Government’s Restoring Your Railway Fund, but local leaders are hopeful of succeeding in round two.
Stourbridge MP Suzanne Webb met with West Midlands Mayor Andy Street to plan out the next stage of the project.
She said the line would have significant benefits for economic regeneration, public transport connectivity and the development of numerous brownfield sites along the route that are earmarked for housing and commercial use.
Ms Webb said: "This is an exciting project very much fitting in with the Government’s levelling up agenda and one that will bring investment and jobs to Stourbridge as well as much better public transport links into the wider West Midlands.
“Although the scheme did not receive a round one allocation from the fund, it is very much in the Department for Transport’s thoughts and we have been asked to submit more information.
“I will be pushing for ministers to make the money available.”
Mr Street said: "This service sits within my wider transport plan for the region which is already bringing the Metro to Brierley Hill.
“This is a very achievable project that will make a big difference to residents in this part of the West Midlands with much greater connectivity to the Black Country and into Birmingham by rail, if it goes ahead.”
In recent years a number of plans to reopen the line have bitten the dust, including one in 2012 that would have seen a number of stations reopen, including Brierley Hill.
Mr Street's £15 billion transport plan will see new railway stations built in Darlaston, Willenhall and Aldridge.
A bid for funding for a new Tettenhall station has been submitted.