On the 9th of November 1769 English navigator Captain James Cook landed on the shores of the bay, firstly named Te Whanganui-a-Hei (the great bay of Hei), to observe a Transit of Mercury - earning it the Mercury Bay moniker.

The mouth of Mercury Bay is 10km across with the coastline extending roughly 20km. On the shore of the bay is Whitianga, and a natural harbour is formed by an arm of the bay which extends inland a further six km. Several small islets are located at the southern and northern extremities of the bay, and the Mercury Islands are also located 10km to the north. Buffalo Beach, Wharekaho, Ferry Landing, Shakespeare's Cliff, Lonely Bay, Flaxmill Bay, Cooks Beach, Purangi Estuary, Cathedral Cove, and Hahei are all located inside the bay.