This species is closely related to Tsuga dumosa and Tsuga chinensis and shows intermediate characters. It occurs in the area where the ranges of these two species meet: the Lijiang Shan and mountains to the northwest (NW Yunnan) and north (SW Sichuan). In Flora of China 4: 41 (1999), T. forrestii has been treated as a variety of T. chinensis.
Forrest's Hemlock is a timber tree used for construction, aircraft, furniture and as props for mines. This species is present in several arboreta in Europe and North America, almost exclusively from early 20th century introductions made by the famous 'plant hunters' of the time.