The municipality lies surrounded by vineyards, meadows and forests in the natural and cultivated landscape of the Moselle valley not far from the university city of Trier.

The village lies at the foot of a small, narrow mountain, a former river island surrounded by an old riverbed of the Moselle that has now been cut off from the mainstream.

In neighbouring Brauneberg on 11 August 1998, a record temperature of 41.2 °C in the shade, the highest ever air temperature recorded in the Federal Republic, was confirmed at the Meteomedia weather station by Jörg Kachelmann (however, Brauneberg is not said to be Germany’s number-one hotspot because the weather station is not included in official measurements owing to its location on a slate mountain).

The barrier formed by the Eifel shields Mülheim from west winds, putting it in a rain shadow and sometimes subjecting it to a föhn effect.

Tied in with this is the high humidity due to ongoing evaporation of water from the Moselle, which, especially in summer, makes at times for heavy and muggy weather, and which also brings many storms along with it.

As early as about 500 BC there came settlement by the Treveri, a people of mixed Celtic and Germanic stock, from whom the Latin name for the city of Trier, Augusta Treverorum, is also derived.

After the collapse of Roman hegemony, the area around Mülheim was taken over by the Salian Franks, which their king, Childebert II, eventually donated to Bishop Agericus of Verdun.