Railroad Tycoon II is a train and business simulation video game in the Railroad Tycoon series. Railroad Tycoon II covers the entire history of railroads from inception to the present day and beyond. The player chooses a map and assumes the role of chairman of a railroad company. The player tries to make profits for investors and completes various other objectives while being hindered by rivals, random events such as train breakdowns, train robbers, economic swings, and scripted events particular to the scenario.

Most of the gameplay consists of building tracks, stations and trains, which are used for hauling passengers and freight from one station to another.