Spanning 10.7 miles (17.2 km) in Cache County, it connects the towns of Paradise, Hyrum, and Nibley with the city of Logan to the north.

The route's southern end is in the town of Paradise in the southeast corner of the Cache Valley.

[4] In 1965, State Route 162 was extended north from Liberty to Avon, ending at the southern terminus of SR-163.

[2] SR-162 absorbed SR-163 the following year, in order to maintain continuity in the state highway system.

In the process, the road from Liberty to Paradise was removed from the state highway system, and the road from Paradise to Hyrum was re-designated as part of State Route 165, along with added roadway from Hyrum to Logan.