Derrynane Harbour sits on the southwest extremity of the Iveragh Peninsula on Ireland's southwest coast, roughly 1. 5 miles north of Lamb's Head.

It is a small, landlocked natural harbour enclosed by Abbey Island to the south and Lamb's Island to the east, entered through a narrow southwest-facing channel between rocks.

The harbour is noted for its remote, sheltered character, surrounded by sandy beaches. A substantial pier at Bunavalla occupies the northeast corner, while a smaller drying pier sits at the southwest end.

The nearby hamlet of Caherdaniel lies tucked among trees along Derrynane Bay's eastern flank.