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Amsterdam is located in the western Netherlands, in the province of North Holland. The river Amstel terminates in the city centre and connects to a large number of canals that eventually terminate in the IJ. Amsterdam is situated 2 metres (6.6 feet) below sea level. The surrounding land is flat as it is formed of large polders. A man made forest, Amsterdamse Bos, is situated southwest. Amsterdam is connected to the North Sea through the long North Sea Canal.

Amsterdam is intensely urbanised, as is the Amsterdam Metropolitan Area surrounding the city. Comprising 219.4 square kilometres (84.7 square miles) of land, the city proper has 4,457 inhabitants per sq km and 2,275 houses per sq km. Parks and nature reserves make up 12% of Amsterdam's land area.

Amsterdam is home to more than one hundred kilometres (60 miles) of canals, most of which are navigable by boat. The three main canals are Prinsengracht, Herengracht and Keizersgracht. In the Middle Ages, Amsterdam was surrounded by a moat, called the Singel, which now forms the innermost ring in the city, and makes the city centre a horseshoe shape. The city is also served by a seaport. It has been compared with Venice, due to its division into approximately 90 islands, which are linked by more than 1,200 bridges.

After the floods of 1170 and 1173 locals of the river Amstel vicinity built a bridge over, and a dam across the river, hence giving its name to the village: "Aemstelredamme". The earliest recorded use of the name "Aemstelredamme" (Amsterdam) comes from a document dated October 27, 1275. Inhabitants of the village, by this document, were exempted from paying a bridge toll in the County of Holland by Count Floris V. This meant it had been allowed for the inhabitants of the village of Aemstelredamme to travel freely through the County of Holland without having to pay toll at bridges, locks and dams all throughout the county. The certificate describes the inhabitants as homines manentes apud Amestelledamme (people living near Amestelledamme). By 1327, the name had developed into Aemsterdam.

As the commercial capital of the Netherlands and one of the top financial centres in Europe, Amsterdam is considered an alpha world city by the Globalization and World Cities (GaWC) study group. The city is also the cultural capital of the Netherlands. Many large Dutch institutions have their headquarters there, and seven of the world's 500 largest companies, including Philips and ING, are based in the city. In 2012, Amsterdam was ranked the second best city to live in by the Economist Intelligence Unit (EIU) and 12th globally on quality of living for environment and infrastructure by Mercer. The city was previously ranked 3rd in innovation by 2thinknow in the Innovation Cities Index 2009.

Famous Amsterdam residents included Anne Frank the diarist, the artists Rembrandt van Rijn and Vincent van Gogh, and the philosopher Baruch Spinoza.