Haidong is the easternmost division of Qinghai province. It is bounded by Xining, the provincial capital, to the West, the Datong River Valley to the north, Gansu to the east, and the Yellow River to the south. Mountain ranges tower above the district of which the main valley is the one of the Huang Shui (Tib. Tsong Chu), a major tributary of the Yellow River. This valley stretches from west to east and makes up - together with the area around Xining, the landscape which is called Tsongkha ("Onion Valley") by Tibetans. It has a total area of 13,100 square kilometres (5,100 sq mi).

According to archeological discoveries, this area was proved to be inhabited by human settlers. Before the Qin Dynasty (221BC-206BC), nomads of the Qiang lived here. In the early Western Han Dynasty (206BC-24AD), the troop of the court defeated the Huns in the west of the Yellow River, and a fortress was established in the city to protect against the invasion of nomad groups.

Haidong enjoys a semi-dry continental climate, Haidong features arid and cold weather at high altitudes, lot of sunshine and great temperature differences during the day.