The prefecture's name is derived from the Tibetan word བདེ་ཆེན (dêqên), which means "auspicious place".

Deqin occupies the northwest corner of Diqing Prefecture, and in latitude has a range of 27° 33'−29° 15' N and in longitude has a range of 98° 36'−99° 33' E, covering an area of 7,596 square kilometres (2,933 sq mi),[3] bordering the Tibet Autonomous Region to the northwest and Sichuan to the northeast.

It is located in the central part of the Hengduan Mountains, and contains the valleys of the Salween, Mekong, and Jinsha Rivers.

The town is nonetheless a little warmer during the winter than Shangri-La County to the east despite being slightly higher in elevation, due to its more southerly aspect.

Rainfall is concentrated between June and September, accounting for nearly 60% of the annual total of 640 mm (25.2 in); snowfall is rare but still causes major transport problems in the winter.