When dropped, the Searing Totem will randomly select an enemy within 25 yards of it and continuously attack that target until A.) the Searing Totem expires, B.) the target leaves its 20-yard radius, or C.) the target dies. If B or C occur, the totem will randomly choose another target in range and begin attacking it. If there are no targets within range, it will do nothing until an enemy comes in range. Also note that the totem will only engage hostile targets on its own; it will ignore neutral targets, unless you engage them first.
It is useful primarily in single-target, prolonged fights (e.g. boss fights). You should avoid using it in situations where it could accidentally hit a target that shouldn't otherwise be hit (such as something that has been CC'd).
Very useful in PvP for an extra bit of consistent damage. Most players will ignore the totem, knowing it will go away when you die and not wanting to take the time to target it.
Always useful in a boss fight, assuming the boss doesn't have adds which get CC'd.
Most of the time, if you drop the totem while you are in melee, it will start out attacking the target you have selected. This may be a function of closeness, or may be a function of who you have selected at the time. It is suspected that it simply picks the closest target when it doesn't have one.
The totem of has only 5 hp, making it trivial to destroy.
Dangerous to use when it can break a CC effect, or when it may pull an as-yet-unpulled group of creatures.
Searing Totem is one of the four totems that have a chance to be summoned by a Shaman's "Totemic Call" Hero Power in Hearthstone.