[1] The Norwegian National Road 41 runs along the east side of the village.

The small village grew up around the harbour due to the increased traffic in people and goods moving along the waterway.

The village served as a traffic hub for a large part of the Vest-Telemark region.

Prior to Kviteseidbyen's establishment, the site of the old church was the main gathering place for the municipality.

The first dairy in the village came into operation in the early 1890s, and Kviteseidbyen became known for its good butter.