At the end of that year it was assigned to the 37th Army, which was detached from the Front to serve as a garrison unit in the Balkans after the German forces were driven north into Hungary.

The 394th began forming on 19 August 1941 at Tiflis in the Transcaucasus Military District,[1] Its order of battle, based on the first wartime shtat (table of organization and equipment) for rifle divisions, was as follows: Col. Valerian Sergeevich Dzabakhidze was assigned to command of the division on the day it formed, but he was replaced on 2 September by Col. Semyon Pavlovich Storozhilov.

In August the division moved with its Army into the Caucasus region to face the German and Romanian forces that were advancing there as part of Operation Blue.

By the end of the day some of the leading Axis troops had reached Klukhori Pass, which was defended by just two companies of the 1st Battalion of 815th Rifle Regiment.

The combined force stymied further efforts by the German 1st Mountain Division to advance, but its own counterattacks failed due to faulty tactics.

[12] In July the 394th returned to the Reserve of the Supreme High Command, but it was back in the fighting front for the Donbass Offensive in August.

The offensive was renewed on 30 January after a powerful artillery preparation against the positions of the German XXX Army Corps on the same sector, but this was met with a counter-barrage that disrupted the attack.

A new effort the next day, backed by even heavier artillery and air support, made progress but still did not penetrate the German line.

During the next two days 6th Army tried to avoid encirclement by slogging through the mud to the Kamenka River line, which was already compromised by the Soviet advance.

[16] The 394th was given a battle honor for its part in this action:"KRIVOI ROG... 394th Rifle Division (Colonel Lisitsyn, Aleksandr Ivanovich)...

The troops who participated in the liberation of Krivoi Rog, by the order of the Supreme High Command of 22 February 1944, and a commendation in Moscow, are given a salute of 20 artillery salvoes from 224 guns.

"[17]During the following days the 6th Army fell back to the line of the Ingulets River but the division soon helped to force a crossing there and also took part in the liberation of the town of Novogo Buga, for which on 19 March it was awarded the Order of the Red Banner.

The two divisions managed to capture small and precarious footholds on the narrow strip of flatlands west of the river but could advance no farther.

However, the German XXIX Army Corps reinforced the defenses at Chebruchi, allowing the 76th Infantry Division to shift most of its forces to its left wing and halt the Soviet advance.

On 1 November the division saw its final change of command with the appointment of Col. Ilya Samsonovich Titov to replace General Lisitsyn.