Shady Valley is an unincorporated community in Johnson County, and it is the second highest community in Tennessee at an elevation of 2785 feet. Shady Valley is also the name of the valley in which the town is located. The community is situated between Iron Mountain to the southeast and Holston Mountain to the northwest. The center of the town is located at the intersection of US Hwy 421 and TN Hwy 91. Shady Valley is served by a Post Office assigned zip code 37688. The community also has several businesses located in the area, an elementary school and a volunteer fire department.
Shady Valley is home to some historic cranberry bogs. The valley once contained about 10,000 acres of boreal cranberry bogs with a few still remaining in the area. These are cold adopted ecosystems that are far south of their usual range. On the second weekend in October, the annual Cranberry Festival is held in the valley to celebrate the cranberry bogs. The annual festival includes a parade, food, music and auctions.
The valley is also home to the famous Snake 421 Motorcycle & Sport Car Route which offers some of the best motorcycle touring available in the southeastern United States. The Shady Valley Country Store located in the middle of the valley serves as the hub for this ride and provides information, food, gas and Snake merchandise.