The town is situated in the middle of the southern half of Bornholm, between Rønne and Nexø. The Danish TV-station TV2 has a local office (TV2/Bornholm) in Aakirkeby. Aakirkeby could be translated to "Stream Church town", as Å or Aa is a stream. When speaking of the church alone, which dates from the mid-12th century, it is separated into two words: Aa Kirke.
Myreagre Mølle, a whitewashed windmill built in 1865, is located 3 km to the east of Aakirkeby on the road to Nexø.