New Zealand State Highway 94 passes through the tunnel, linking Milford Sound to Te Anau and Queenstown, by piercing the Darran Mountains at the Homer Saddle.

[1] Government workers began the tunnel in 1935 after lobbying by J. Cockburn of the Southland Progress League,[citation needed] and the completion of at least a rough road to the eastern portal site in the same year.

Work was also interrupted by World War II (though the actual piercing of the mountain had successfully been achieved in 1940), and an avalanche in 1945 which destroyed the eastern tunnel portal.

The passengers and the bus driver had to walk through the pitch-dark and smoke-filled tunnel to safety with the help of high beams from vehicular traffic at the entrance of the eastern portal.

The traffic lights operate only during the day during the peak summer season, since the avalanche risk makes it unsafe to stop and queue at the portals in winter and spring.

In addition, Transit New Zealand (as of 2005[update]) had the realignment of the Homer east portal avalanche shed as one of the 'large activity priorities' on its planning list.

[8] In 2020 widening was not in scope when the New Zealand Government announced $25 million in funding for tunnel safety improvements through its rejuvenation package and the works were commenced, expecting to be completed by 2023.