The kingdom lies east of Nepal and west of the Indian state of Arunachal Pradesh

It is south of the Tibetan hinterland and north of the Indian territories of Assam and West Bengal.

Located in the heart of the high Himalayan mountain range, Bhutan is a land-locked country surrounded by mountains in the north and west. The rugged east, visited by few Western travellers, borders the sparse and largely unknown Indian state of Arunachal Pradesh. The high Himalaya in the northern steppes separates the kingdpm from Tibet.

The population of 600,000 is made up primarily of indigenous Bhutanese. Many naturalised citizens came originally from Tibet and India. In the higher reaches of the kingdom and in some isolated valleys, hill tribes assuming Bhutanese nationality thrive on the land. Some, like those from Merak and Sakteng in the east and Laya in the north, have no contact with Western civilisation and trade only in bartered goods.

The lower southern regions are inhabited by migrant Nepalese who have been granted Bhutanese nationality. Most of them are agricultural workers who take advantage of the fertile southern land. Most industrial areas are also located in the south. The southern districts are less populated than central districts but more populated than the northern mountainous regions. Altitudes in the south range from 1,000 to 4,500 feet. Altitudes in the more populated central regions range from 4,000 feet in the east around Tashigang to a high of 17,000 feet over the highest pass. The altitude at Thimphu, the capital, is 7,700 feet.

Until roads were built in the early 1960s, it took travellers at least five days to make the journey from the Indian border at Phuentsholing to Thimphu. A high mountain range separates the lowlands of the south from the central valleys. Before the Chinese closed the border with Tibet in 1959, the Bhutanese used to trade across the lower passes in the north of the country as they remained open during the cold winter months.