Sri Lankan (Ceylon) Railways celebrated its 150 years of service on 27th December 2014. Though its main purpose was on freight transport in the early years, the trend has changed towards passenger transportation afterwards. Sri Lankan rail network expanded to its peak by 1940s under British rulers with two rail gauges of broad and narrow. Later, one of the narrow gauge tracks was removed due to high operational cost, and longer travel times and part of the track was replaced with broad gauge. Three decades of insurgency in the country lead to reduce the full service covering whole network from time to time and only in this year full network come to operational with Northern and Talaimannar line (Connection between South India via Ferry service) back in service nearly after 23 years of abundance. With the development of North and Thalaimannar lines with and upgrading of Southern line with an Indian grant, the authorities plan to increase the maximum speeds of these trains at 100kmph. Further, in the last four years, Sri Lanka Railways moving towards phase lift in rolling stock in order to improve passenger service. With the introduction of Push Pull units with AC compartments with air suspension systems and introduction of luxury compartments served by private company aiming at foreign tourists are some of them. However, when compared with many other developing countries in the region, though Ceylon railways has 150 years of long history, current level of service, and working facilities are not at a satisfactory level. Therefore, this research is done in order to recognize the customer perspective on the current level of quality and to identify their own grievances as well as the employee perspective on the current administration and functionality of Sri Lanka Railways. A survey was carried out with the assistant of structured questionnaires designed for different segments and face to face interviews in order to collect data. Statistical analyses were carried out in order to find out main complications and their interdependency for the service degradations and few other areas identified during the interviews. It is determined that the main issue faced by the commuters is the poor service due to lack of fund allocations for the maintenance of existing facilities and from employee side political interferences to the service has created several managerial issues, high bureaucracy and lack of adequate technological inputs have led to poor service. Finally, a sustainable model has been presented to revamp the service back on track in order to deliver better service with better employee satisfaction.