No, it’s not illegal as there is no law written against it. However, it is highly recommended to drive with two hands on the wheel for proper control of the vehicle, especially during sudden or unexpected situations or emergencies. Often those two seconds it takes to get your hand onto the wheel in an emergency is two seconds too long.
ICBC will not qualify drivers on the road test if they’re driving with only one hand on the wheel. This makes a strong statement about what our provincial driver licensing crown corporation thinks about this (hint, hint).
And I am not 100% sure but if a traffic officer saw you driving down the highway with your knees, you could perhaps still receive a
“undue care and attention” ticket, or something like that.
See this post for more info: How to hold (and not hold) the steering wheel.