The city is at the junction of Interstates 35 and 90, about south of the Twin Cities. It is on the shores of Fountain Lake, Pickerel Lake, Albert Lea Lake, Goose Lake, School Lake, and Lake Chapeau. Fountain Lake and Albert Lea Lake are part of the Shell Rock River flowage.
The city's early growth was based upon agriculture, farming support services and manufacturing and was a significant rail center. At one time it was the site of Cargill's headquarters. Other manufacturing included Edwards Manufacturing (barn equipment), Scotsman Ice Machines, Streater Store fixtures, and Universal Milking Machines. Like many U.S. towns much of the manufacturing base has diminished. A long-time center of the city's job opportunity was the Wilson & Company meat packing plant, later known as Farmstead and Farmland. This facility was destroyed by fire in July 2001. The largest employer is currently Mayo Clinic Health System with over 1,500 employees.