Due to the limited number of experimental laboratory studies examining the effects of dynamic railway stress on adjacent retaining structures, a laboratory investigation was conducted to study the effect of lateral dynamic pressure generation on steel walls. A test was carried out using a scale model that was 1/7th the size of the actual railway and steel sheet pile. These tests were performed under various parameters. The highest rate of increase in lateral stresses occurred during the initial loading cycles, and the dynamic lateral stress distribution was found to be nonlinear. The most significant factor improving the performance of walls and railways is the increase in the soil's relative density, as it reduces active stresses and increases passive stresses. When the relative density of the subgrade changes from 30% to 55% and from 55% to 75%, the active lateral stresses decrease by an average of 33.52% and 22.44%, respectively, while passive lateral stresses increase by 16.83% and 19.1%, respectively. Increasing the amplitude of dynamic loads imposed on the railway leads to an increase in the horizontal stresses generated on both the active and passive sides of the wall. Additionally, the horizontal distance between the wall and the railway inversely affects the dynamic lateral pressures.