At a relatively close distance of 6.5 million light years IC342 would be one of the brightest galaxies in the sky if it weren't for its untoward location, only 10.5 degrees from the galactic equator (Milky Way disc plane). Obscured by the interstellar matter of the Milky Way, its light is heavily attenuated (by 2.4 magnitudes) before it reaches us and its field is cluttered with foreground Milky Way stars. IC342 is a member of the nearby IC 342/Maffei group. This loosely arranged group contains about 16 members including the two dominant members, IC 342 and Maffei 1. It represents the nearest grouping of galaxies to our local group and evidence tells of an interaction with the local group some eight billion years ago. The most luminous galaxies in the group are the giant spiral IC 342, the elliptical Maffei 1, and the intermediate spiral Maffei 2. Maffei 1 is the nearest normal giant elliptical galaxy to the local group but is also optically dim having its light extinguished 5.3 magnitudes by the Milky Way.

IC 342 is an open two armed spiral and the closest galaxy to the Milky Way with a circumnuclear starburst ring. The cluster of stars near the nucleus formed in a short lived burst some 60 million years ago. Most likely the starburst was triggered by gas inflows into the central 1000 light years of the galaxy driven by the presence of a small scale bar. The newly arrived dense gas formed a central ring which triggered the starburst and now surrounds the nuclear starburst region. At least 5 prominent giant molecular clouds have been found associated with the molecular ring along with several large star forming regions. A prominent feature of IC342 is the numerous and very visible HII regions. IC 342 rivals M81 and M33 among local galaxies in the number of visible HII regions. Probably they are made more apparent by the relative extinction of the shorter wavelength light by the intervening interstellar dust of the Milky Way.