Dozens were injured in the accident at the Falls of Cruachan near Oban at 9pm. Police said about 60 passengers and rail staff were rescued from the train's two carriages and described many as "walking wounded".
One theory being investigated is that the accident was caused by boulders falling on to the line.
The front car of the train derailed and caught fire at the Falls of Cruachan power station in Argyll and Bute.
The ambulance service said there were some "walking wounded" but stressed that the bulk of the injuries were minor.
A spokesman said: "The first carriage has been derailed above the road. Initially it was thought there was about 50 casualties, but it's nowhere near that. There's quite a lot of walking wounded. There's a couple of bumps to necks and backs and things like that."
Ambulance and Ministry of Defence helicopters were also called to the scene because of the remoteness of the area, he said.
The spokesman said some of those on board were being taken to hospital, but was unable to confirm the numbers involved. Ambulance workers set up a triage at the power station to deal with injured passengers.
The train was the 1820 Glasgow Queen Street to Oban service. A spokesman for British Transport Police last night said:
"All passengers have been safely taken off the train, but the leading car remains overhanging the road."
A spokesman for Strathclyde Fire and Rescue said a passenger rang them to tell them of the derailment. "We attended the derailment of a Glasgow to Oban train in which two carriages were precariously balanced over a 15 metre embankment."
He added: "The fire and rescue control room received a 999 call from a passenger reporting the derailment.
"Our service immediately put into motion a major deployment of fire crews and appliances, including our major incident unit (MIU) from Clydebank and heavy rescue vehicle (HRV) from Easterhouse.
"In addition to the MIU and HRV and the two rescue pumps from Oban, we have deployed one pump each from Dalmally, Inveraray and Arrochar."
One local resident said he understood the derailment had been caused by boulders falling on the track.
"I have heard it derailed because of boulders coming off the mountains on to the track because of all the rain we have recently had."
An industry source backed up these claims. He said: "A possible explanation could be a rock fall."
When asked if a rock falling could have caused the accident, a Network Rail spokeswoman said: "It looks like it's possible but the rail accident investigators need to consider all options."
Strathclyde Police said: "There were around 60 passengers and staff on the train and they have been taken from the train to Cruachan power station.
" We are working closely with Strathclyde Fire and Rescue and the British Transport Police. At this stage there are no serious injuries reported."
A spokesman for train operator ScotRail said an investigation was under way. He said: "All passengers are safely off the train."
A spokesman for the Cruachan power station refused to comment.