[3] Banya is situated in the Mezhdenik ridge just north of the Sredna Gora mountain range, facing the Tvarditsa Valley.

The village is on the left bank of the river Tundzha some 2 km downstream of the Zhrebchevo Reservoir.

The mineral waters near the village of Banya are captured in the alluvial sediments along the right bank of the river Tundzha.

The water is with mineralization of 0.94 °g/L, with high content of fluorine — up to 16 °mg/L, and silicon dioxide.

[5][6] In 2011, 60% of the village's population was Bulgarian, 20.9% was Turkish, and the remaining 19.1% belonging to other ethnic groups or choosing not to answer.