"Why 4 Rails?
The London Underground uses the four rail system for two main reasons. Firstly, it was originally required by the government to limit the voltage drop along the line to 7 volts. This was intended to reduce problems caused by stray currents causing electrolysis affecting utility pipes and cables. Whilst this did not affect the street tramways, whose vehicles were not heavy current users, the currents drawn by trains could cause difficulties. The solution was either to provide heavy return cables and boosters or to use a fourth rail. The fourth rail was chosen, partly as a cheaper option and partly for signalling reasons. As direct current track circuits were to be used to control signals, an insulated return system for the traction current was an effective way of separating the two systems. Nowadays, this is not so much of a problem as all track circuits are AC." Source:
http://www.trainweb.org/tubeprune/tractioncurr.htm