Dire Dawa is one of two chartered cities (astedader akabibi) in Ethiopia (the other being the capital, Addis Ababa). This chartered city is divided administratively into two woredas, the city proper and the non-urban woreda of Gurgura.

Dire Dawa lies in the eastern part of the nation, on the Dechatu River, at the foot of a ring of cliffs that has been described as "somewhat like a cluster of tea-leaves in the bottom of a slop-basin." With a latitude and longitude of 9°36′N 41°52′E / 9.6°N 41.867°E / 9.6; 41.867, this city is the second largest in Ethiopia.

The city is an industrial centre, home to several markets and the Aba Tenna Dejazmach Yilma International Airport. Haramaya University is 40 kilometers away from the city.