A branch of PSH 21 connecting the main highway to the Bremerton ferry terminal was added to the state system in 1961 and was renumbered to SR 304 in 1964.

A major improvement project began in 1998, building a new boulevard to serve SR 304, widening the highway through Bremerton, and adding a short tunnel for westbound traffic from the ferry terminal.

[2] The five-lane highway (including a westbound high-occupancy vehicle lane during peak hours)[1][3] carrying SR 304 travels northeast on Charleston Boulevard along a section of the Puget Sound and Pacific Railroad (owned by the U.S. Navy) and the shore of the Sinclair Inlet.

[6][7] From its junction with SR 310, the highway turns east onto Burwell Street and continues through a residential neighborhood on the north side of the naval base.

[23] The western side of Bremerton and neighboring Charleston were served at the turn of the 20th century by Washington Boulevard, which continued southwest along Sinclair Inlet to Gorst as an unpaved road.

[31] Construction on the section through Charleston and western Bremerton began in late 1917 and the entire Navy Yard Highway was dedicated on June 12, 1923.

[50] It was planned alongside a new building for the city's ferry terminal and the western expansion of the naval shipyard, which would close a section of Callow Avenue.

[56] A total of 150 properties were acquired for the Bremerton Gateway project, which began construction in October 1998 with demolition to make way for a widened Burwell Street and other downtown changes.

[58][59] The first section of Charleston Boulevard opened to traffic in February 2001, replacing a one-block turn onto Farragut Street to reach Callow Avenue by following the shipyard's outer fence.

[65] A 959-foot-long (292 m) tunnel in downtown Bremerton opened on July 6, 2009, allowing westbound traffic from the ferry terminal to bypass several congested intersections on Washington Avenue; it took two years to construct and cost $54 million.

[66] The tunnel's opening was criticized for impacting traffic for downtown businesses, but the lower vehicle volumes contributed to the area's walkability.