[3] Gunnedah is situated within the Liverpool Plains, a fertile agricultural region, with 80% of the surrounding shire area devoted to farming.

The Namoi River flows west then north-west through the town providing water beneficial to agricultural operations in the area.

The Gunnedah area is a significant producer of cotton, coal, beef, lamb and pork, and cereal and oilseed grains.

[4] Gunnedah is located on the Oxley and Kamilaroi Highways providing convenient road links to much of the northern sector of the state including to the regional centre Tamworth, 75 kilometres (47 mi) distant.

The town has a station on the Mungindi railway line and is served by the daily NSW TrainLink Xplorer passenger service to and from Sydney and Moree.

Gunnedah and the surrounding areas were originally inhabited by Aboriginal Australians speaking the Kamilaroi (Gamilaraay) language.

[5] In 1818, English surveyor general John Oxley traversed the district, for which a monument pays tribute to him at the base of Mullaley Mountain.

With settlement in the area focused on wool production, Gunnedah was initially known as 'The Woolshed' until taking its name from the local Indigenous people who called themselves the Gunn-e-darr,[7] the most famous of whom was Cumbo Gunnerah.

Gunnedah Shire is situated 264 metres (866 ft) above sea level on the Liverpool Plains in the Namoi River valley.

The climate is hot in summer, mild in winter and dry, although rainstorms in catchment areas occasionally cause flooding of the Namoi River.

For a brief three-year period after the railway arrived in Gunnedah it was the railhead until construction was completed to Boggabri and then to Narrabri South Junction in 1882.