Jiuquan is located in the middle section of the Gansu Corridor in northwest Gansu Province. It was an important town on the Silk Road and a strategic point in military contests of the past. Today it has become an important hub of communications in western China, linking Xinjiang to the west with other parts of the county by railways and highways. Jiuquan also has rich mineral resources. Its steel production has reached 500,000 tons per year, making it an important steel center in northwest China.

The desert around Jiuquan is very impressive, and surface water resources are rare. It is said that in 121 B.C. during the reign of the Emperor Wu of the Han Dynasty, when General Huo Qubing and his army camped by a spring east of the city after a victorious expedition to Gansu, Emperor Wu bestowed wine on the army as a reward. As there was too little wine for so many soldiers, General Huo poured the wine into the spring, whereupon fragrant wine gushed out like springwater, giving the whole army plenty of wine to drink. That is how the city came to be called Jiuquan - the Wine Fountain.