Großräschen is south of the Niederlausitzer Landrücken, a sandy stretch of land with pine forests in the centre of Lusatia.

Outside the town proper are the villages of Freienhufen (historically Dobristroh), Bulldorf, Dörrwalde, Wormlage, Saalhausen, Woschkow, and Schmogro (Großräschen-Ost).

From the middle of the 19th century onwards, heavy industry developed, and the villages grew rapidly.

The 1980s brought the destruction of Bückgen, whose 4000 inhabitants had to leave their homes and were moved into blocks of flats.

After the fall of the Berlin Wall, the industrial decline (glass manufacturing, brick production, mining and agriculture used to appear in the town's coat of arms) caused heavy unemployment.