Locomotive engineers at Canadian National walked off the job early Saturday after last-minute negotiations collapsed just before a midnight Friday strike deadline.
The two sides had begun talks at noon in Montreal at the invitation of federal mediators.
Teamsters union spokesman Stéphane Lacroix had said there was a possibility the strike could be postponed if the railway agreed to negotiate and not impose a 1.5 per cent wage increase and revised distance caps.
The strike by the 1,700 engineers could affect service, but analysts believe the railway can continue to operate since many of its supervisors and managers are qualified engineers.
Via Rail said earlier that its passenger service would be unaffected by a strike.
In the Montreal region, the Metropolitan Transport Agency said a strike would force the cancellation of service on its Montreal/Deux-Montagnes and Montreal/Mont-Saint-Hilaire train lines.
In a statement, the agency said it was seeking a court injunction to block a strike, calling it "unacceptable" that service for 38,000 commuters a day could be "held hostage" by a labour conflict.
In the event of a walkout, the agency said it would try to arrange for shuttle service for commuters, starting Monday.
The most recent strike at CN ended after more than two months in 2007 when Parliament enacted back-to-work legislation affecting 2,800 conductors represented by the United Transportation Union.