Lupeni holds an important place within the geographical and environmental aspects of the Jiu Valley and Hunedoara County, being located on the West side of the Jiu Valley, at an altitude of 675-725m. Lupeni is parallel with the Jiu de Vest River, being framed by two ranges of mountains that unite the Retezat Mountains and Parang Mountains, giving the city an oblong form. Lupeni is located at the foot of the Vulcan Mountains, which are situated on the southwest side of the "Meridionali" (Southern side) Carpathians. In the Eastern part of the Vulcan Mountains, you can see the group of mountains Straja, Negri, and Mutu that belong to Lupeni. These are very important tourist sites for the area.

The administrative territory of Lupeni is part of the Jiu Valley group of towns, and is situated in the proximity of the south west corner of Hunedoara County. It has as neighbors the city of Vulcan in the East, Uricani in the west, Gorj county to the south, and to the north, Baru village.

The area surrounding Lupeni is very picturesque and has great potential as a winter sports resort, or a SPA for recreation and rest.

Relief
The city's relief is generally varied because of the great number of valleys that come down from the surrounding mountains.

A range of hills dominate the Valley from 150 - 200 m, connecting the mountains to the lower areas.

Lupeni is located in an area of remarkable beauty, with the peaks of Straja, Mutu and Negri to the south, and the Retezat Mountains to the north (Zanoaga, Dupa Piatra, Oboroca, Scorusu, Dealu Mare). The "Dupa Piatra" peak in particular has excellent potential for rock climbing. Also here you can find dafodil glades.

Straja peak, the second heighest in Vulcan Mountains at 1868 m, is more than 300 m higher than the other peaks in the vicinity. The summit in the case of the Mutu Peak is rather high, going down gradually to "La Paru de Fier" (1468 m), then up again towards Siglaul Mic and expecially Siglaul Mare (1682 m). This peak offers an excellent view of the Retezat and starts the southwards journey of the summit.

The Negri Peak lies on the southern side of the Valcan Mountains at a height of 1700 m, between Straja and Siglaul Mic Peaks. It has an excellent slope degree for skiing, and also a reserved slope.

The hydrographic network of the area is represented especially by Jiul de Vest River (which springs from the mouth of the Soarbele), together with its tributaries: Valea Vacii, Rosia, Sohodol, Tusu, Lazaru, Mierleasa, Mierlasu, Boncii, Braita.

Flora and fauna
The vegetation is characteristic of the Southern Carphatians, with some exceptions due to relief, elevation, climate and the nature of the rocks and soil. The difference in altitude, higher in the West (Oslea 1946 m) and East (Straja 1868 m) and lower in the center, as well as the exposure and the slanting of the slopes, leads to a vertical and compositional differentiation of flora. On the southern slope, the beech trees grow separately or in combination with the common oak or (rarely) with the fir tree.

The spruce fir appears sporadically. On the margin , the beeches are sometimes bordered by a narrow chain of fir trees on the lower and middle sides of the northern slope. The beech tree and subordinately, the spruce fir and fir tree, can be found succeeded by a narrow strip of mixed forests and then pure fir groups with a variable extension. The forest shelter consists of brush and vividly colored herbaceous plants - snowdrops, cowslips.

The meadows lie on the higher border of the forest. The juniper tree appears only on Oslea. The meadows are full of blackberry bushes, rowan trees, gooseberries, currant, and juniper.

The fauna is very rich and varied. The following birds can be found: the grosbeak, the eagle owl, the martin, the eagle, the hawk, and the wagtail. The fish are well represented in the mountain waters. Especially abundant are trout, miller's thumb, and moioaga. The viper lives both on the southern limestones and in some places on the Scocul Jiului. Mammals live mostly in the forests (wild cats, foxes, wolves, squirrels, wild bears, hinds, deers, polecats, lynxes). The bear holds an important place amoung the fauna of these mountanins. The chamois appeared/migrated?? spontaneously in Oslea from the Retezat Mountains.

Climate
Thanks to its position, Lupeni has a cooler climate, being protected by the mountains against strong winds.

The city of Lupeni is one of the mountain towns in Hunedoara county, with an annual average temperature of 8 - 10°C.

The Petrosani area has an annual rainfall of 700 mm. The average amount is 56 mm in February and 100 mm in July.

The Straja and Negri peaks are covered by snow both winter and spring, from November until April or May, each year.

The winds have no single direction, their variety being determined by the general location of the valleys and by the lower parts of the mountain slopes. Strong winds coming off these slopes allow for the potential practicing of extreme sports such as paragliding.