Shady Valley is an unincorporated community in Johnson County, in the northeastern corner of the U.S. state of Tennessee. It is just outside Cherokee National Forest. Shady Valley is also the name of the valley in which the town is located, between Holston Mountain, ""the twin city of Mountain City, Tennessee, on the northwest, and the Iron Mountains to the southeast. At 2,785 feet, it is the second-highest community in Tennessee.

Johnson County is a county located in the U.S. state of Tennessee. As of the 2020 census, the population was 17,948. Its county seat is Mountain City. It is the state's northeasternmost county, sharing borders with Virginia and North Carolina.