Ayabe is situated in the mountains of Northern Kyoto Prefecture, with the Yura River flowing through the center of the city.

Ayabe has a Humid subtropical climate (Köppen Cfa) characterized by warm summers and cool winters with light to no snowfall.

Per the Nihon Shoki and other historical sources, the area was settled during the Kofun period by the Hata clan, immigrants from mainland Asia who brought with the technology of sericulture and weaving.

After the Meiji restoration, the town of Ayabe was established within Ikaruga District, Kyoto on April 1, 1889 with the creation of the modern municipalities system.

The area was known from ancient times for weaving cloth, and the leading apparel manufacturer Gunze's registered headquarters are in Ayabe.