Okaya is located in central Nagano Prefecture at the western shores of Lake Suwa and the headwaters of the Tenryū River.

Okaya has a mayor-council form of government with a directly elected mayor and a unicameral city legislature of 18 members.

The city is grouped into an electoral district with Shimosuwa, which contributes four members to the Nagano Prefectural Assembly.

The region's local industry is predominantly made up of medium and small-size businesses, but some larger corporations, including Seiko Epson, Olympus and Kyocera have factories in Okaya.

[4] After the World War II, Okaya established itself as a manufacturing city of precision machinery, focusing on producing products such as watches and cameras.