Lüderitz is located on the only part of the Namibian coast with a rocky shore not far from the old town of Kolmanskop
. A peninsula with numerous coves, locally called fjords and bays, juts out of the coast at an angle to form the bay proper. Three small islands -- Penguin, Seal and Flamingo -- lie within the bay. Shark Island was once also an island in the bay, but a solid causeway now joins it to the mainland. It encloses the harbour and a yacht basin.
Twelve islands lie in Namibian waters north and south of Lüderitz. Collectively they are known as the Penguin Islands or sometimes the Guano Islands. Penguin colonies live on few islands nowadays, but guano still accumulates abundantly, as seabirds -- especially cormorants and gannets -- roost and breed on all the islands. The islands are bleak and barren, except for a few bushes on Possession, the biggest one with an area of 90ha.