The town is nestled on the gentle slopes of a hilly basin from where the creek named Görlitzbach originates.

This stream flows northeastwards past Münchenbernsdorf's municipal neighborhoods, or villages, of Kleinbernsdorf, Kananda, and Schöna on its way to its mouth that opens into the White Elster river, just north of Gera.

Within 2 kilometers west of Münchenbernsdorf, one finds the eastern watershed for the Saale river near the village of Tautendorf.

To punish the Kingdom of Saxony for its allegiance to Napoleon and France, the Vienna Congress of 1815 granted certain tracts that included Münchenberndorf to the Grand Duchy of Saxe-Weimar-Eisenach, then ruled by Grand Duke Charles Augustus (in German: Carl August).

In the late 1800s and early 1900s, the community prospered economically through the introduction and growth of carpet factories, permitting the acquisition of town privileges (in German: Stadtrecht) in 1904.