Novi Grad is located in the far northeast of Republic of Srpska, in the border part with Federation BiH and Croatia, and is one of the oldest and most picturesque Krajina towns on Una River.
This was one of the biggest railway and road traffic hubs in former Yugoslavia (the first railway in Bosnia-Herzegovina was built in 1873 – Dobrljin – Banjs Luka railway which now connects Republic of Srpska, Croatia, Federation of BiH and wider. Novi Grad is 135 km away from Zagreb, 90 km from Banja Luka, 320 km from Sarajevo and 396 km from Belgrade.
Rivers Una and Sana represent a significant water potential of the municipality and the region, and also represent the most important surface waters in Novi Grad municipality. Una is a border river between Bosnia and Herzegovina i.e. Republic of Srpska and Republic of Croatia.