© 2018 TU Delft. Brittle White Etching Layers on in-service rail steels initiate surface cracking which can progress to cause squats. Ex-service damaged rails containing both WELs and squats were investigated using electron microscopy and synchrotron diffraction. In heavy breaking rail regions, WEL containing martensite and retained austenite was observed, alongside undeformed pearlite at the interface layer between the WEL and the base rail head. It was concluded that this type of WEL, referred as TP-WEL, is induced by temperature and pressure changes. In contrast, in low braking utilisation regions where the traffic speed is steady, WEL caused by rolling contact fatigue deformation contained nanocrystalline martensite and a region of severe plastic deformation immediately below the WEL. This type of WEL is termed as SD-WEL. Microstructural observations suggest that both WELs types play significant roles in crack initiation and squat formation.