The charity which runs the popular tourist attraction was only just recovering from the spring lockdown.
But it says that the new rules which mean people can only travel in and out of Denbighshire for work or education means it has no choice.
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Chairman of the railway, Liz McGuinnes, said that the new restrictions for North East Wales had caused Llangollen Railway to suspend train services for the period October 2-14, pending review.
"After a meeting with the board it was agreed that we would close after the last service on October 1.This will be under constant review. We don't have an option and I do hope this will be short lived," she said.
The railway faced a major financial crisis earlier this year because of the lockdown and lack of income.
It was given a helping hand in the form of a National Lottery Heritage Fund grant of £161,000.
The railway put in place a range of Covid safety measures and had enjoyed a busy last few weeks of the summer.