This experimental study was performed to examine the potential formation of white etching layer (WEL) on medium carbon rail steel using a thermo- mechanical simulation test. The purpose was to explore whether a martensitic WEL can be formed on the surface of the steel at after heating under pressure rail to temperatures below the critical pearlite-austenite transformation points. The investigation was conducted using a Gleeble 3500 thermo-mechanical simulation device. Samples were rapidly heated to different temperatures under a constant pressure which exceeded the material’s elastic limit, held for 2 mins and then rapidly quenched. Based on microstructural and hardness investigations, combined with synchrotron diffraction results it was concluded that a WEL layer observed on the top surfaces of the samples was, in fact, martensitic in nature. Observation of the martensitic product formed on the top surfaces of the rails heated under pressure to below the eutectoid transformation temperature imply a significant effect of compressive pressure on the austenite start Ac1 and austenite finish Ac3 temperatures in this rail steel. It was found that the depth of the martensite layer formed underneath the contact area increased relatively with respect to rising temperature and constant pressure, consistent with increases in what amount of austenite induced near the surface prior to cooling. The maximum and minimum transformation temperatures, Ac1 and Ac3, for the 0.78 wt.% carbon steel have been calculated theoretically using empirical formulae, and a considerable difference was found between these results and those which can be implied from the tests involving applied pressure. Hardness tests were also conducted, which confirmed the features observed in the material structure. The results strongly suggest that, under the pressures generated during wheel-rail contact, it is not necessary to reach high temperatures in order to form a white etching layer on the rail surface.