The highway serves to connect communities along the southern banks of the Hiwassee River.

NC 294 is a two-lane mountain rural highway that is wholly in the Nantahala National Forest.

It also goes by Fields of the Wood, a bible park, and access to the Hiwassee Dam.

In 1932, it was extended east by overlapping with US 64/NC 28 then southwest on new primary routing to the Georgia state line, towards Blue Ridge.

In 1942, NC 294 was rerouted north onto upgraded existing and new construction, bypassing Postell on Candy Mountain Road (SR 1150).