Singapore today took ownership of Malaysian railway land in its territory, putting into action a landmark agreement that ended decades of wrangling between the neighbouring countries.

Struck in September, the multibillion-dollar land swap, in which Malaysia got land parcels in central Singapore, also marked the end for a historic train service between the city-state and Malaysia.

The last train of the Malayan Railway (KTM) with the sultan of Johor in the driver's cab and railway buffs on board departed the 1932-build Tanjong Pagar station late Thursday in central Singapore.

At midnight, the KTM railway land, including stations and other structures, was handed over to Singapore. All Malaysia-bound trains now start and end their journeys from Singapore's Woodlands train checkpoint at the border.

"With the closing of this chapter, our countries can now move ahead to advance our many shared interests," Singapore Prime Minister Lee Hsien Loong said.

"Today, we mark a historic breakthrough in our bilateral relations," he said.

Since Singapore was kicked out of the Malaysian federation and became independent in August 1965, the 26-kilometre stretch of Malaysian-controlled railway land running deep into the city-state's centre has been a thorn in the flesh of its rulers.

But in September, Lee and his counterpart Najib Abdul Razak reached a territorial deal, including the transfer of the KTM railway track, effective from July 1.

'Our country will have no more heritage'

As the end for the historic railway line and the iconic Tanjong Pagar station drew nearer, train tickets were all snapped up.

Shutterbugs flocked to the station while souvenir hunters queued to buy mementos, including bags, coffee mugs and T-shirts.

On social networks like Twitter and Facebook, Singaporeans bid nostalgic farewells to both the KTM trains and the station, a Singapore landmark building now listed as a national monument.

"It's a shame," one comment on Facebook said. "Soon our country will have no more heritage, just stories and pictures to tell about."

Environmental campaigners like the Nature Society of Singapore earlier urged the government to preserve the railway trail covering 173.7 hectares of land as a "green corridor."

The group pushed for a six-month moratorium to allow for public comment but said so far it had not received any official reply from the government.

The handover of the railway land is part of a larger framework of agreements between Singapore and Malaysia designed to pave the way for a further warming of relations.

Under the deal, Singapore state investor Temasek Holdings Ltd and its Malaysian counterpart Khazanah Nasional Berhad are set to jointly develop projects worth billions of dollars.

Both countries said they also planned to build a rapid transit link scheduled to be operational by 2018.

- dpa