Salamanca lies east of the district of Chamberí, south of Chamartín, and north of Retiro.

The district is administratively divided into 6 wards (Barrios): The population of Madrid at the beginning of the 19th century was about 220,000, increasing to 300,000 inhabitants in the late 1850s.

In 1857, the government allowed the then Minister of Public Works and Transportation Claudio Moyano to expand the city (Plan Castro).

Queen Isabella II allowed this in 1860 and the defensive walls were torn down in order to build the first Madrilian ensanche.

Salamanca is in the outer area of the Rondas, where the neighborhoods of Guindalera and Fuente del Berro originated with more spontaneous urban development.