SEStran commissioned a 'STAG' study which concluded re-opening Leven's line is, pound-for-pound, the best value option for the area.
"I am delighted we have overcome this first hurdle," said rail campaigner MSP Tricia Marwick.
"The people o
f Levenmouth knew what was needed and now we have the evidence which backs us up!"
The STAG report – which looks into sustainable transport solutions – revealed Levenmouth's roads are already congested and getting worse.
In 2004, the Standing Stane carried 15,000 vehicles a day, of which HGVs accounted for as much as 27 per cent of the traffic.
As well as a 4500-strong petition handed to transport chiefs SEStran by Tricia Marwick, many members of the public submitted completed questionnaires.
Feedback included complaints of bus reliability to Edinburgh being very poor and more expensive than travelling by car.
The report said: "Safety on the main road links to and from Levenmouth emerged as a serious concern as were the poor links both by road and with the public transport between Levenmouth, other areas of Fife and beyond.
"This is impeding Levenmouth's economic competitiveness, constraining employment and reducing opportunities for attracting young skilled people to the conurbation; all of which reinforces the perception of Levenmouth as an area characterised by chronic and high deprivation."
The report recommends two options for the area – reinstating the rail link, which it believes could provide a service to the Fife circle every half hour.
Experts also support a rapid bus service from Leven to Markinch railway station, which could be the "Do-minimum" option or an interim solution until the rail link is established.
Although the costs are considered conservative, the survey reckons improved bus services for Leven would cost £10m, the rail link is double that.
Furthermore, while buses would bring benefits, rail would bring major benefits because it would serve freight-dependent industries such as Diageo.
Mrs Marwick commented: "Obviously there's a long way to go, there's a second appraisal in the summer which goes into more detail.
"There is clear recognition that the opening of the existing railtrack to passengers and freight is the option that brings the most benefits.
"What is important now is for Fife Council, both elected members and officials, to give the necessary evidence to allow a STAG 2 appraisal."
The report revealed it was unlikely a rail link could be delivered before 2015 but Mrs Marwick said she had "no idea" where this date came from.
"I know that rail projects can take a while, but what is important is that between us in the last few months we have got a project back on which had fallen off 10 years ago; from nowhere, Leven's rail link is back on the political agenda and that's thanks to the Mail and the people of Levenmouth.
She added: "The idea that buses are a solution is, quite frankly, barking. If it was the answer, we would have done it years ago.
"What's most important is getting an acceptance in principle that we will get a railway."
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