Skelbo was set aside by Sutherland Estate as a possible resettlement area for displaced tenants in 1808.  By 1811, the tenants had begun to take up small crofts on the Muir and there were 33 settlers there by 1821.  Few, if any were successful because of the poor quality of the ground.  A plan of Skelbo Farm in 1820 indicates six labourers cottages along the top of Skelbo Street.  Skelbo Wood is a mature Scots Pine plantation which dates from about 1900.  Coul Links is a large area of dunes with a transition from the shore from wood to heath, while wet slacks and winter pools add to the range of habitats.  Skelbo Castle is a crumbling ruin overlooking Loch Fleet.  It dates from the early 12th century.

The Railway started at a junction with the Sutherland Railway at The Mound Station, bridging the River Fleet by a four-span viaduct.  The Mound is actually a causeway built across the River Fleet by Thomas Telford in 1816.  The Railway skirted the southern shore of Loch Fleet to its first stop at Cambusavie Halt. The next station was Skelbo, equipped with a goods siding, whereupon the line bore inland slightly and turned South, climbing to the fishing village of Embo. Following the coast of the Moray Firth on its last leg, the line passed the Royal Dornoch Golf Club before crossing the road and terminating in Dornoch.