Bully Creek's headwaters are located near Sheep Rock in the southern edge of the Blue Mountains, southwest of Ironside.

[3] Wedged between the Northern Basin and Range and the Blue Mountains ecoregions, the watershed experiences an arid climate.

Large mammals such as Rocky Mountain elk and mule deer, bobcats, beavers, otters, and raccoons inhabit the region.

[8] The Bully Creek watershed is vegetated primarily by Sagebrush, although Quaking Aspen, Water Birch, and Cottonwood grow in riparian zones.

[8] Melting snow and heavy rain caused the Jordan dam to fail on Bully Creek 19 miles (31 km) west of Vale on February 5, 1925.

The Jordan dam was cheaply built only 2 years prior for irrigation purposes by investors who wanted to plant wineries in the Willowcreek Valley.