It is located in the northwestern part of the Dzungarian Basin, on the edge of the Gurbantünggüt Desert.

The Ailik Lake is fed by the Baiyang River, flowing from the Saur Mountains on the Dzungarian Basin's northern rim; the river forms a small delta as it enters the lake (45°58′00″N 85°47′00″E / 45.96667°N 85.78333°E / 45.96667; 85.78333).

[1] Due to the construction of the Baiyang River Reservoir and the Huangyangquan Reservoir, and the concomitant diversion of the Baiyang River waters for irrigation, aquaculture, and other economic needs, the Ailik Lake started shrinking in the 1980s; by the mid 1980s, it was just 15 km2 in size and hardly 1 meter deep; by the 1990s, it had virtually dried up.

the Small Alike Lake, 45°45′35″N 85°34′13″E / 45.75972°N 85.57028°E / 45.75972; 85.57028) and the dry Alan Nur lake (Chinese: 阿雅尔诺尔; pinyin: Āyǎ'ěr Nuò'ěr, or Chinese: 艾兰诺尔; pinyin: Àilán Nuò'ěr;[3] 45°42′00″N 85°23′00″E / 45.70000°N 85.38333°E / 45.70000; 85.38333), which until 1915 was the end point of the Manas River.

Potentially, water can seep through the same fault even farther to the southwest, to the dry Alan Nur lake.