According to the United States Census Bureau, the town has a total area of 1.9 square miles (5.0 km²), all of it land. The town has an elevation of 2,330 feet (710 m), so the climate of the area is considerably cooler than might be expected of a town in a southern state.

Mars Hill College, a private, coed, liberal-arts college, is located in Mars Hill. Founded in 1856, it is the oldest college or university in western North Carolina. The college is affiliated with the North Carolina Baptist Convention. Due to the presence of the college, residents of the town of Mars Hill enjoy a much greater variety of cultural, intellectual, and entertainment offerings than would usually be found in a town of its size. The college's enrollment typically runs from 1300 to 1600 students; they are not included in the census calculations of the town's population.

As of the census of 2000, there were 1,764 people, 541 households, and 312 families residing in the town. The population density was 911.7 people per square mile (352.9/km²). There were 586 housing units at an average density of 302.9/sq mi (117.2/km²). The racial makeup of the town was 91.21% White, 5.95% African American, 0.28% Native American, 0.85% Asian, 0.85% from other races, and 0.85% from two or more races. Hispanic or Latino of any race were 1.36% of the population.

There were 541 households out of which 20.5% had children under the age of 18 living with them, 45.1% were married couples living together, 11.1% had a female householder with no husband present, and 42.3% were non-families. 33.1% of all households were made up of individuals and 17.4% had someone living alone who was 65 years of age or older. The average household size was 2.10 and the average family size was 2.68.

In the town the population was spread out with 11.7% under the age of 18, 43.1% from 18 to 24, 16.2% from 25 to 44, 15.7% from 45 to 64, and 13.3% who were 65 years of age or older. The median age was 23 years. For every 100 females there were 89.1 males. For every 100 females age 18 and over, there were 86.7 males.

The median income for a household in the town was $32,917, and the median income for a family was $45,000. Males had a median income of $29,615 versus $23,625 for females. The per capita income for the town was $13,366. About 11.1% of families and 16.9% of the population were below the poverty line, including 21.1% of those under age 18 and 14.9% of those age 65 or over.

Hot Springs | Mars Hill | Marshall

Breakaway | Joe | Luck | Petersburg | Revere | Trust | Walnut