Railtrack wants to transform a sealed piece of railway history into a leisure complex. Stephenson's Vaults, beneath the north London stretch of the main East Coast rail line, have lain unused for 150 years.

The Grade II listed vaults are the legacy of the engineering challenge created by Parliament's decision in 1835 to site the passenger terminal for the London and Birmingham Railway, the capital's first passenger rail link, at Euston. The line had to cross the Regents Canal and under the Hampstead Road but locomotives were unable to cope with the one-mile slope up to Camden.

The ingenious solution, first conceived by Robert Stephenson, son of the inventor of The Rocket, and the railway's chief engineer, was to haul trains up from Euston on a 10,000ft rope, using steam-driven winches housed in the vaults.

A 1938 book, Euston Old Euston, records that the 'trains were drawn up the Camden incline by the endless rope at the rate of 20 miles an hour'.

In Stokers and Pokers, published in the 1840s, Sir Francis Head remembers 'the moaning of the whistle signal from Camden followed by the loud ringing of the station bell, at which all the waiting cab horses raised their drooping heads and pricked their ears'. Later, the winching vaults and Euston station maintained contact via an electric telegraph line, believed to be the first used in Britain.

However, by 1844, six years after the railway opened, locomotives had been designed that could manage the slope, making this extraordinary hauling system redundant. The winding machinery was sold to a Russian silver mine, the two 132ft exhaust chimneys were dismantled and the vaults sealed up.

The secrets of this cavern - more than 110ft long, 20ft deep and 60ft wide - were known only to railway historians and track safety engineers. When these engineers sought permission to fill the vaults with concrete in the early Eighties instead of continuing their annual inspections, word filtered through to BR's pro-perty division, which realised their commercial potential.

Railtrack, which inherited the scheme when it was formed in April, is being advised by architects Boisot Waters Cohen. Brian Waters's plans for the 11,000sq ft development envisage much of the original brick work being on view, to 'enhance the beauty of the vaulted spaces'.

The two largest vaults, running down the centre, almost 86ft long, 46ft wide and 20ft deep, would become a restaurant and dance area.

The two long vaults on either side, once used as coal stores, would be split-level, with kitchens and toilets on the ground floor and changing rooms and offices on the mezzanine level. A swimming pool would be dug in the 70ft by 30ft vault that once held the two engines. Two further vaults would house fitness equipment.

The entrance would be from the southern end, via a gallery overlooking the main central vaults. Waters, who was responsible for the Sanctuary fitness centre in Covent Garden, hopes this gallery could be used as exhibition space, and display a working model of the original winching system.

Initial redevelopment could cost more than pounds 3m, and several leisure companies have expressed interest.

English Heritage has given its consent for the redevelopment. 'If treated sympathetically, there is no reason why they (the vaults) should not become known as one of the rediscovered sights of London,' said Zoe Croad of its London division.

Camden Council, considering Railtrack's application for planning permission, said: 'We're glad to see an opportunity for the site to be brought back into use.'

(Photographs omitted)