Twentieth-century American railroad officials struggled with unanticipated problems introduced by telegraphic train dispatching. The growing power of the Order of Railroad Telegraphers, a militant union, contributed to rising labor costs and shortages of skilled workers. Despite these problems, officials with major trunk lines were hesitant about replacing telegraphy with a newer communications technology, the telephone. In 1907, the federal government forced railroads to act decisively. Congress passed the Hours of Service Act, which limited the number of hours that dispatchers and telegraph operators could work in a 24-hour period. The act effectively forced companies to double their workforce of skilled telegraph operators, a nearly impossible task. Instead, major railroads shifted a considerable volume of train dispatching to new telephone systems. Following 1907, railroad officials enthusiastically praised the advantages of telephony for railroad management purposes. Some managers even argued that it was ideally suited for railroad operations, unlike the telegraph. My paper examines the impact of the 1907 Hours of Service Act on the American railroad industry and looks at how it altered management practices, labor relations, and communications technologies. It highlights the influence of broader political, social, and economic factors on American railroad management in the early twentieth century.