 Nightcaps has a more industrial history than most Southland towns due to nearby coal deposits.A private railway was built from the terminus of the New Zealand Railways Department's Wairio Branch to Nightcaps to provide more efficient transport of coal; operated by the Nightcaps Coal Company, it opened not long after the state's railway reached Wairio in 1909.In 1918, a proposal was made to build another line to coal interests around Ohai, and the construction of this line was fiercely opposed by the Nightcaps Coal Company, fearing a loss of business.