Rail corrugation is a typical rail surface defect that can reduce rail service life and increase maintenance costs. Manifested as undulating wears on rail surface, the formation and growth of rail corrugation relies on a combination of wheel-rail dynamic interaction and rail surface wear. While rail grinding can remove corrugations, it does not stop corrugations from recurring. Therefore, it is essential to comprehend the root causes of corrugation, as well as to predict rail wear rate. In this paper, we designed and constructed a three-dimensional wheel-rail interaction model using finite element analysis (FEA). Physical mechanisms of rail wear were simulated through explicit FEA. We also studied the dynamic responses of vehicle-track system, in terms of wheel-rail contact pressure and rail wear profile, of smooth and corrugated rails. To predict rail wear rate and distribution in the longitudinal direction, Archard's wear law was adopted. Results reveal fluctuations of wheel-rail contact pressure and an exponential growth of wear-type rail corrugation, thereby enabling better understanding of corrugation growth mechanisms for extended rail service life and effective maintenance decisions.