Before the Transcontinental Railroad was built, transportation was slow, arduous, and dangerous. Relying mostly on horses and other draft animals, carts or buggies, and your own two feet, travelling across the US could take months and put you at risk for robbery, losing your way, the loss or death of your draft animal (and then no way to move your goods), and many many more factors that made the trek very difficult and potentially life-threatening. Not only was the transportation of goods and people slow and difficult, but so was the transportation of news and correspondence. To think of it in a more modern sense, if a disaster (think Hurricane Katrina or state-wide fires) were to happen, those forces that could send aid would take days, weeks, or even months to get the news and then take just as long to send aid.
The Transcontinental Railroad changed all this by connecting the United States "from sea to shining sea" and providing a foundation for the jump start of the Industrial Revolution within the United States. More and heavier goods could be transported faster and further, people could spread more widely across the continental United States, and news and information could be more timely and accurate.
The American Transcontinental Railroad, while seemingly insignificant in today's times, was (and is) a very important part of our nation's history, for a number of reasons. These include the following:
1) It validated the concept of manifest destiny, or the 19th-century idea that the nation was destined to expand from the East Coast to the West. While this idea had existed for some time, the construction and existence of a cross-country railroad gave it new meaning, as the United States was now literally united by bands of iron.
2) It represented the technological progress of the Industrial Revolution. Railroads were a major advance in technology which first came about in the early 19th century, and the 1,776-mile Transcontinental Railroad was seen as an inevitable, and monumental, result of this development. Furthermore, the way in which the railroad itself was constructed is an example of changing methods for doing so. Rather than being built to fit the natural landscape as most European railroads were, American railroads reshaped the land to better accommodate the track, and the tunnels, bridges, and snow sheds on the Transcontinental Railroad were all characteristic of this new type of engineering.
3) The Transcontinental Railroad quite literally made the world seem smaller. Until the railroad was built, traveling from the East Coast to the West could take many months, regardless of whether a person went by ship around South America or across the land in a covered wagon. Upon the railroad's completion, it was now possible to make the trip from San Francisco to New York City in one week. Additionally, the railroad enabled the spread of goods and ideas to different parts of the American continent. Not only were the markets of the West Coast opened to the East and industrial products from the East reaching the growing West, ideas and information could now traverse more easily between them.
4) Unfortunately, the railroad also signified a threat to the traditional way of life for the Native American peoples. The Transcontinental Railroad was viewed as an undeniable marker of the ever-approaching white settler society, and treaties drafted during this time (such as the 1868 Treaty of Fort Laramie) essentially forced Native Americans onto reservations so as to allow for white emigrant settlers to populate the land. This settlement of white Europeans also resulted in the near-extinction of the buffalo herds so vital to the Native American people (for food, clothing, shelter, weapons, etc.), as these herds were relentlessly slaughtered so that the buffalo hides could be shipped to the industrial markets back east.