It lies 24 km north-west of Srinagar city in the village of Khanpur on the right bank of the Jehlum River.

The famous Manasbal Lake lies 6 km in the north.

Khanpursar Lake is fed by springs and a few ephemeral channels and outflows into Jehlum River.

Willow plantations and paddy cultivations are a part of its catchment area.

The lake is an important source of fish and the lotus stem.