On the eve of the breakup of Yugoslavia, ethnic tensions and the opposition of Serbs in northern Dalmatia and Lika to the Croatian government led to a series of incidents and interruptions of rail transport on the Lika line. On October 4, 1990, the line was (allegedly) bombed near Zrmanja Vrelo; on October 17 a mine was laid on the tracks between Malovan and Gračac. Passengers and railway personnel were harassed on the track segments around Knin hub and the traffic was frequently interrupted. Goods from cargo trains were also stopped in Knin and taken over by rebel Serb authorities. The traffic on the line was finally severed on July 24, 1991 as separatist Serbs blocked the railway line leading into the Lika (from north) and Northern Dalmatia (from south) across the territories where they comprised the ethnic majority and proclaimed their secession. As the Croatian Railways were not in position to guarantee safety, they formally and officially closed the line north from Drniš and south from Gračac on August 7. The breakaway Republic of Serb Krajina controlled the most of the line between the 1991 and August 1995. Some minor local passenger traffic was organised by rebel authorities between Knin and Gračac between 1991 and 1994, plagued by the shortages and reductions of fuel. Serb Krajina Army even operated an improvised armoured train (Krajina Express) on Lika railway to support its combat operations against Croatian Army. After the Croatian forces overran and liberated the occupied territories during the Operation Storm in early August 1995 and Croatian Railways had taken over, CR found significant damage along the Lika line stemming from combat operations, theft and destruction. The line was severed in some places, Simac tunnel had caved in, signals, phone cables, automatic switchboards were damaged, and stations in Josipdol, Plaški, Vrhovine, Lički Osik, Gospić and Medak were damaged or destroyed. CR CEO estimated the repair cost at HRK 50 million in 1995.