Cape Agulhas is located in the Overberg region, 170 kilometres (105 mi) southeast of Cape Town. The cape was named by Portuguese navigators, who called it Cabo das Agulhas—Portuguese for "Cape of Needles"—after noticing that around the year 1500 the direction of magnetic north (and therefore the compass needle) coincided with true north in the region. The cape is within the Cape Agulhas Local Municipality in the Overberg District of the Western Cape province of South Africa. Agulhas is serviced by the nearby small airport of Andrew's Field.
South of Cape Agulhas the warm Agulhas Current that flows south along the east coast of Africa retroflects back into the Indian Ocean. While retroflecting, it pinches off large ocean eddies (Agulhas rings) that drift into the South Atlantic Ocean and take enormous amounts of heat and salt into the neighbouring ocean. This mechanism constitutes one of the key elements in the global conveyor belt circulation of heat and salt.
Cape Agulhas has a gradually curving coastline with rocky and sand beaches. A survey marker and a new marker depicting the African continent are located at the most Southern tip of Africa. The waters of the Agulhas Bank off the coast are quite shallow and are renowned as one of the best fishing grounds in South Africa.
The rocks that form Cape Agulhas belong to the Table Mountain Group, often loosely termed the Table Mountain sandstone. They are closely linked to the geological formations that are exposed in the spectacular cliffs of Table Mountain, Cape Point and the Cape of Good Hope.