Goshen is located in southern Addison County, within the Green Mountains. It is bordered by the town of Leicester to the west, Salisbury to the northwest, Ripton to the north, and Hancock to the northeast. To the east is the town of Rochester in Windsor County, and to the south and southwest, in Rutland County, are the towns of Chittenden and Brandon, respectively.

Settlements in the town include Goshen, near the town's western border, and Goshen Four Corners, in the center of the southern part of town. Vermont Route 73 runs east–west through Goshen, passing through Goshen Four Corners, and crossing the crest of the Green Mountains at Brandon Gap (elevation 2,183 ft or 665 m) near the town's east border. The Long Trail crosses Route 73 at Brandon Gap and passes over the summits of Mount Horrid (3,216 ft or 980 m) and Cape Lookoff Mountain (3,350 ft or 1,020 m) within Goshen. Goshen Mountain (3,292 ft or 1,003 m) is in the southeast corner of the town. Most of Goshen lies within the Green Mountain National Forest.

According to the United States Census Bureau, Goshen has a total area of 20.8 square miles (53.9 km²), of which 20.7 square miles (53.5 km²) is land and 0.15 square miles (0.4 km²), or 0.78%, is water.

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