From its southern terminus, NM 240 heads north–northwesterly as a two–lane road, running a bit northeast of and roughly parallel with the Rio Grande del Rancho.

About 2.3 miles (3.7 km) from its southern terminus, NM 240 makes a sharp turn to head west and abruptly reaches a T intersection with the east end of Los Cordovas Road.

Heading northerly from that intersection, NM 240 connects with the west end of Riversong Ranch road, crosses the Rio Pueblo de Taos (a bit upstream from its confluence with the Rio Grande del Rancho), and connects with the east end of Camino De La Culebra road, before making a hard turn to the east.

After connecting with the south end of Upper Ranchitos Road, NM 240 heads easterly, diverging from the northeasterly upstream course of the Rio Pueblo De Taos.

As of 2015[update], the highest traffic section along NM 240 (the southernmost 2.367 miles [3.809 km]) had an AADT of 3,963, with a nearly 12 percent increase over the previous two years.

The lowest traffic section (the 2.367 miles [3.809 km] west of Upper Ranchitos Road) had an AADT of 1,044, with little change over the previous two year[5] The entire route is in Taos County.