Modern condition and structure of the passenger transportations market, as well as modern problems of passenger transportations development are investigated in the article. The passenger turnover of public transport in Ukraine in 2011-2017 is analyzed. It has been defined that the volumes of traffic and passenger turnover in transport in general, and in railway transport in particular, have significantly decreased, which happened due to the instability of political and economic situation in Ukraine. The main factors influencing consumer demand for various modes of transport, in particular, railway, are identified. It is defined that the main reason for the critical condition of Ukrainian railways is the fact that the sector has not carried out structural reforms in time, which have been carried out by European countries long. Time ago. It is indicated that the work of railway transport currently requires large investments to meet the needs of the population in safe and high-quality passenger transport, ensuring efficient operation and development (renewal of passenger rolling stock), increasing industry competitiveness. Directions of maintenance of the effective activity of railway transportation enterprises under conditions of quality and traffic safety improvements are defined. It is suggested to clearly divide all trains by distance: suburban; regional and long-distance which will enable to meet customers’ needs and wants, as there are passengers with certain requirements on speed, price and comfort and its essential to be taken into account. It is suggested that all passenger trains should be divided into different classes with homogeneous rolling stock, so that the loss will be subject to predictive regulation by: number of cars changes; frequency of running; tariff changes; improvement of service delivery quality.