Located west of Interstate 5 at the southern edge of the city, the South Neighborhood is home to over 1,500 Bellingham residents. The large areas of undeveloped property and significant natural features help define the character of the neighborhood.

Chuckanut Mountain rises steeply from Chuckanut Creek in the southernmost part of the neighborhood. Chuckanut Bay is another resource within the neighborhood, which is an historic site as well as a unique natural recreational resource of city wide significance. There are also several water bodies within the neighborhood, which are used and valued by residents. These include Hoag's Pond, Chuckanut Creek, and the marsh area along the interurban right-of-way. Development in the South Neighborhood has been limited by these physical restrictions and has occurred in small residential pockets, primarily in the more developable parts of the neighborhood. Most of these areas are developed at a low density with housing which is a mixture of ages and conditions, with the exception of multifamily housing in the northern portion of the neighborhood. Chuckanut Village perhaps epitomizes the historical character of the area with the image of a small, secluded Puget Sound fishing village. Fairhaven Park and Rose Garden is a city park within the South Neighborhood which is highly valued by the residents of this and adjacent neighborhoods, as well as by citizens throughout Bellingham. Located on Padden Creek, this 17-acre area is part of the city's heritage of community parks.

Arroyo Park is a natural area city park located along Chuckanut Creek in the southern portion of the South Neighborhood. This 67 acre park is a steep ravine on either side of Chuckanut Creek. The Interurban Trail is a multi-use greenway and trail corridor that runs 7 miles from Fairhaven to Larrabee State Park. The City has acquired over 100 acres of natural open space area along the Interurban Trail.