It is located in the province of Eastern Finland and is part of the Northern Savonia region. The municipality has a population of 21,603 (31 March 2016) and covers an area of 385.62 square kilometres (148.89 sq mi) of which 138.45 km² (53.46 sq mi) is water. The population density is 55.96 inhabitants per square kilometre (144.9/sq mi).

The municipality is unilingually Finnish. Oddly enough, 'Varkaus' translates to 'theft', even though it is not the reason for giving that name to the city. In old Finnish the same word also meant strait, and this city is located in the lake district on straits between two parts of Lake Saimaa. An extension of the Saimaa Canal passes through the town.

The town became an industrial center in the end of the 19th century with the A. Ahlström paper mills. During the Finnish Civil War in 1918 the town was taken over by the Reds, but because of its isolated location in rural Finland, it was soon taken by the Whites on the Battle of Varkaus 19–21 February. The whites proceeded to execute every tenth Red soldier.

The municipality of Kangaslampi was consolidated to Varkaus on 1 January 2005.

Warkauden Pallo-35, or just WP-35, plays in the highest division, Bandyliiga, and has become Finnish champions 16 times.

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