Caburgua Lake is located 23 km northeast of the city of Pucón, in the La Araucanía Region of Chile. Huerquehue National Park lies to the east of the lake. Like Villarrica Lake, it is part of Toltén River basin. During summer the outflow river may dry out but due to high levels of underground infiltration the waterfalls Ojos del Caburgua never run dry.
The lake occupies a glacial valley carved out along the Liquiñe-Ofqui Fault. In the Holocene the valley was blocked by lava flows from the Volcanes de Caburgua.
The lake has recently gained notoriety for the holiday residences of people like Sebastián Piñera and President Michelle Bachelet.