Petrosani is situated in the South-Eastern part of Hunedoara County, in Petrosani Depression or popular “Jiu Valley”, at the confluence of the Eastern Jiu (Romanian) with the Western Jiu (Transylvanian), surrounded by mountain ranges bordering the valley: Vâlcan to the South, Retezat to the North, Parang to the East, Godeanu to the West.

The average altitude is 615-620 m and maximum altitude is 2,519 m –  Parângul Mare Peak.