To the north of Binz stretches the Schmale Heide (the "narrow heath"), a tongue of land which joins the Muttland region of Rügen to the Jasmund peninsula.

The land to the south and east of Binz is hilly, reaching a height of over 100 metres above sea level.

Binz is known for its well-kept historical resort architecture and natural scenery, close to the Jasmund National Park and its chalk cliffs.

Binz lies on the eastern coast of the island of Rügen between the bay of Prorer Wiek and the lake of Schmachter See.

North of Binz is the Schmale Heide, a neck of land that links the Muttland – Rügen's central region – with the peninsula of Jasmund.

The annual precipitation is 611 mm and is relatively low, falling within the lowest quarter of values within Germany.

A first sign of its subsequent importance as a Baltic Sea resort arose as early as around 1830, when guests of the Prince of Putbus bathed at the mouth of the Ahlbeck (the outflow of the Schmachter See).

From 1818 to 4 September 2011 Binz belonged, apart from a short interruption (1952–1955 Kreis Putbus) to the county of Rügen.

Ten years later, Binz officially became a bathing resort, which meant that building took off: the beach promenade, the pier, the spa house (Kurhaus), a new network of paths and a narrow-gauge railway connection were built.

In 1895, the construction of the Rügen Light Railway from Putbus to Binz followed, as well as the opening of the beach promenade.

Other infrastructure projects included the construction of a drinking water supply and sanitation (1903) and the a power station (Jasmunder Straße).

In 1950, the construction of the Prora complex was completed, and the buildings were used as barracks for the Volkspolizei (People's Police).

In 1953, the government of the German Democratic Republic (GDR), in which Binz was then situated, initiated "Action Rose".

Binz is also linked to the nearby towns of Putbus, Sellin, Baabe and Göhren by the narrow gauge steam railway the Rügensche Bäderbahn, known locally as Rasender Roland.