[2] The town is a popular launching place for tourists exploring the Snowy Mountains area including Kosciuszko National Park.

Khancoban is linked to Jindabyne and Cooma by the Alpine Way, a scenic route that takes travellers past the ski resort of Thredbo.

Khancoban was constructed to house workers involved in the Snowy Mountains Scheme, Australia's largest engineering project, designed to provide hydro-electric power and water for irrigation to vast areas of the nation.

It is characterised by its inland location and likewise windward position (west of the Snowy Mountains); with the summers having a high diurnal range with often chilly mornings, and generally low humidity and rainfall amount—although thunderstorm buildup with a northerly airstream can occasionally give way to much higher dew points.

Winters are chilly, overcast and very rainy, with occasional snowfalls, and a much narrower diurnal range due to frequent cloud cover.