The Shoalhaven River rises on the eastern side of the Great Dividing Range, below Euranbene Mountain, about 350 kilometres (220 mi) southwest of Sydney.

[3] The estuary has two entrances, approximately 5 kilometres (3.1 mi) apart, that flow into the Shoalhaven Bight within the Tasman Sea of the Pacific Ocean.

The northern entrance is located south of Shoalhaven Heads, and is open intermittently, at times of peak flow and during flood events.

It impounds the river's lower reaches to form Lake Yarrunga and part of Sydney's water supply.

Unfortunately, Tallowa Dam has been a potent barrier to migratory native fish with estuarine/marine juvenile stages, blocking species including Australian bass from more than 80% of their former range in the Shoalhaven system.

[10][11] The upper part of the Shoalhaven river, in the district around modern-day Braidwood, is the traditional land of Walbanga people.