This paper provides a review of the literature on vision-based on-board obstacle detection and distance estimation in railways. Environment perception is crucial for autonomous detection of obstacles in a vehicle’s surroundings. The use of on-board sensors for road vehicles for this purpose is well established, and advances in Artificial Intelligence and sensing technologies have motivated significant research and development in obstacle detection in the automotive field. However, research and development on obstacle detection in railways has been less extensive. To the best of our knowledge, this is the first comprehensive review of on-board obstacle detection methods for railway applications. This paper reviews currently used sensors, with particular focus on vision sensors due to their dominant use in the field. It then discusses and categorizes the methods based on vision sensors into methods based on traditional Computer Vision and methods based on Artificial Intelligence.