Recent advancements in railway construction have emphasized environmental sustainability, integrating considerations of environmental impact into the planning and execution of infrastructure projects to reduce costs and mitigate adverse effects. This study investigates the use of steel slag as a sustainable alternative for railway ballast, grounded in shakedown theory. The characterization of the aggregates was performed in accordance with NBR 5564 and AREMA standards, confirming that the material meets most requirements. The mechanical behavior of the ballast was analyzed under cyclic loading conditions, assessing permanent deformation and the material’s ability to achieve stability (shakedown). Triaxial tests with repeated loading simulated real railway conditions, applying vertical stresses up to 600 kPa and confining pressures ranging from 35 to 200 kPa. The results indicate that steel slag aggregates exhibited promising performance, with seven specimens achieving stable deformation levels, characterized by residual deformations of less than 2.5 mm. Notably, these specimens approached deformations on the order of 10−7, indicating stability under cyclic loading. Furthermore, a comparative analysis of shakedown criteria proposed by various authors revealed variations in limits for granular materials, enhancing the understanding of steel slag aggregate behavior. The experimental results were validated through numerical simulations conducted with Systrain software 2.0, which simulated a loading condition of 32.5 tons per axle, confirming the observations with maximum principal stresses ranging from 166 to 184 kPa in the ballast. The analysis showed that steel slag aggregates can withstand stress levels higher than those of granodiorite, reinforcing their viability as a sustainable alternative for railway ballast.