Its mouth is about 70 kilometres (43 mi) wide, located between the town of Vardø in the northwest and the village of Grense Jakobselv in the southeast.

The fjord stretches westwards inland past the town of Vadsø to the village of Varangerbotn in Nesseby Municipality.

[4] The Kven residents of Varangerfjord are largely descendants of Finnish immigrants who arrived to the area during the 19th century from Finland and northern Sweden.

During the first half of the 19th century, the possibility of Russia demanding the cession of a stretch of coast along the Varangerfjord was for some time on the European diplomatic agenda, inducing King Oscar I of Sweden and Norway to conclude an alliance (1855) with Britain and France in order to forestall this possibility.

A 55,450 ha area comprising the northern coast of the fjord and the nearby islands of Hornøya and Reinøya, including intertidal and neritic habitats as well as coastal wetlands and tundra grassland, has been designated an Important Bird Area (IBA) by BirdLife International because it supports large numbers of waterbirds, seabirds and waders, either breeding or overwintering.