Dalhousie sits on the northern shore of New Brunswick. One can usually see the Gaspe peninsula (part of the province of Quebec) across the Bay of Chaleur. Dalhousie is mostly a one-industry town, centered around the Avenor pulp mill and the chemical plant PCI (Pioneer Chemicals).

PCI is the reason why there is train service in Dalhousie. It is served by a spur from the main line, branching off at Dalhousie Junction further west. The pulp mill has trackage but it does not seem to be in use.

The NB Power power plant in Dalhousie used to burn coal from Minto, New Brunswick. The coal would be brought up by rail to Dalhousie Junction, a few miles outside Dalhousie, and trucked from there.