Located on the coast of central Ibaraki Prefecture, Ōarai is bordered by the Pacific Ocean to the east. The Naka River flows through the town. Ōarai and Sun Beach bathing beaches were first to introduce barrier-free bathing beaches for the disabled in Japan.
The villages of Isohama and Ōnuki within Higashiibaraki District and the village of Natsumi within Kashima District were created with the establishment of the municipalities system on April 1, 1889. Ōnuki was elevated to town status on January 26, 1894. Ōnuki and Isohama merged on November 3, 1954 to create the town of Ōarai. A portion of Natsumi was annexed by Ōarai on July 23, 1955.
The nuclear industry and government largess form the basis of the local economy. Main agricultural products include rice, sweet potatoes and Japanese radish. Main fishery products include whitebait, sardines, flounder and clams. Marine food processing includes salted and dried horse mackerel, smelt and sardines and boiled octopus.
Ōarai attracts 3 million visitors a year. Tourist attractions include bathing beaches, yacht and cruiser marina, marine sports, camping site, fishing, aquarium, and a famous golf course. It is known for its monkfish.
The main characters of the animated series Girls und Panzer study in a huge ship originally based in Ōarai. Real locations in the city are depicted faithfully, prompting fans to visit the town and giving a boost to local commerce.