A system and method for detecting and determining the location of (i) defects in railroad track rails and (ii) the presence of cars, trains or vehicles on the rails. A strain sensitive fiber optic cable is continuously bonded to each section of rail, with the cables of adjacent rails being interconnected by non-strain-sensitive fiber optic cable. A detection system provides an optical backscatter sensing function and an optical time domain reflectometry analysis and distance determining function to determine the nature and location of rail anomalies and vehicle presence on the rails.