The song was a success on its initial release and was certified Gold by the RIAA on August 18, 1971 and Platinum on April 10, 2017. The song became one of John Denver's most popular and beloved songs, and is still very popular around the world. It has continued to sell, with over a million digital copies sold in the United States. It is considered to be Denver's signature song.

The song also has a prominent status as an iconic symbol of West Virginia, which it describes as "almost Heaven"; for example, it was played at the funeral memorial for U.S. Senator Robert Byrd in July 2010. In March 2014, it became one of several official state anthems of West Virginia.

Danoff and his then-wife, Mary ("Taffy") Nivert, wrote "I Guess He'd Rather Be in Colorado" and "Take Me Home, Country Roads," both of which were hits for John Denver. Danoff (from Springfield, Massachusetts) has stated he had never been to West Virginia before co-writing the song. Inspiration for the song had come while driving to a family reunion of Nivert's relatives along Clopper Road in nearby Maryland. To pass the time en route, Danoff had made up a ballad about the little winding roads they were taking.He had even briefly considered using "Massachusetts" rather than "West Virginia", as both four-syllable state names would have fit the song's meter.

Starting December 22, 1970, John Denver was heading the bill at The Cellar Door, a Washington, D.C. club. Danoff and Nivert opened for him as a duo named Fat City. After the Tuesday post-Christmas re-opening night (Cellar Door engagements ran from Tuesday to Sunday, and this booking was for two weeks), the three headed back to their place for an impromptu jam. On the way, Denver's left thumb was broken in an automobile accident. He was taken to the hospital, where a splint was applied. By the time they got back to the house, he was, in his own words, "wired, you know".

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