Volunteers working to restore the route had installed bird boxes as part of their efforts to encourage wildlife near Burn Naze station, in Thornton.
But they are now looking at having CCTV installed after a spate of vandalism that saw yobs smear margarine on walls and attack a nest being used by the young chicks.
Geoff Ogden, of the Poulton and Wyre Railway Society (PWRS), which has been granted permission to clear the overgrown line, said it was “frustrating” to see their hard work undone.
The damage was discovered by volunteers who turned up on Monday for a day of working on the line.
In a Facebook post, PWRS said there had been a “substantial” amount of damage caused.
It said: “We have worked hard to look after the environment and encourage wildlife around the line.
“Thanks to some thoughtless act by trespassers seven great tit chicks had their nest destroyed and sadly died. Two other nesting boxes were destroyed but had no chicks at the time.”
The group said the incident, which has been reported to police, was part of a “wider assault” on the area, which has seen fires started deliberately and wildlife destroyed.
The statement issued by PWRS added: “It is not only heartless vandalism that concerns us – it is the safety of everyone. These trespassers are putting their own lives at risk as well as others.
“We have sightings of people who were trespassing on the line at the time when some of these acts were carried out and the police are involved.”
Mr Ogden added: “It’s just mindless – you can’t put it into words. But you’ve got to keep the faith, stand back up and crack on again.”
The group is now looking at repairing holes in fences to stop people trespassing on the line and hopes members of the public will keep an eye out for suspicious behaviour in the area.
Mr Ogden said: “We are also going to be looking at getting CCTV or something so once people are on there and mischief has occurred, we will be able to see who has done it.”
Lancashire Police confirmed an investigation into the incident is currently underway..
A spokesman said: “It was reported to us at 10.30am on Monday as damage and vandalism to railway property that is under restoration at the moment.
“Tubs of margarine were smeared on the walls and bird boxes were smashed.”
Anyone with information about the incident is asked to call police on 101, quoting log number 475 of May 25.