Community members say it could bring more people, and money, into the Dekalb County town.
Amtrak and government grants have contributed over $6 million to make the train station more attractive to riders and the community.
They plan to build an enclosed train stop with bathrooms and increased parking.
Something neighbors say would fix a lot of problems.
Waterloo is one of the busiest train depots in the state.
Over 22,000 people board Amtrak trains from the town.
So why does the station look like this?
No cover from weather, no bathrooms and little parking.
Town Manager DeWayne Nodine says a $4.4 million investment from Amtrak, and a nearly $2 million grant from the US Department of Transportation will change that.
"Then the plan is to start construction in the early 2013 with the completion hopefully by the end of 2014 at the latest," Nodine says.
"Well actually, two things have happened. First, the community has been working to improve their station. And secondly, we have an obligation to make our stations accessible in the Americans With Disabilities Act," Amtrak Media Relations Manager Marc Magliari says.
Nodine says the new building is planned at Center Street and Van Vleek Street, next to the old train depot.
It will have an enclosed waiting area, restrooms, a large well-lit parking lot, and wheelchair ramps.
He says it's a big improvement over what's there right now.
"The parking's horrible, there's no place to get out of the elements when it's a day like today, super hot, or in the winter when it's really cold, there's no restroom facilities," nodine says.
Neighbors agree, and welcome the changes.
"We still have folks who come to our door and ask to use the restroom or the phone or get a drink or anything," says Amanda Stuller.
"I think it'll be good if they can put enough parking in," says Richard Woolever.
Nodine hopes it sparks a downtown revitalization, with the new station within walking distance of downtown.
He says ridership in Waterloo has increased four percent each year for the past ten years, and extra people bring extra money into the city.