Palenzuela lies at the fork formed by the rivers Arlanza and Arlanzón just before they flow into the Pisuerga, standing on rocky crag known as La Horca, and from which both rivers can be seen. The region of El Cerrato is made up of hills and a rugged relief, dotted with plains, steep drops and hillocks forming a spectacular landscape. The town lies between the plains and the greener, more fertile fields.

This is one of the most important towns in El Cerrato and the Pisuerga Valley. It was repopulated by Alphonse XIII, converting it into an important medieval town.

The wall, which stands next to the castle, defended the town. Of the two gates situated on opposite sides, only remains of the one known as La Paz can be seen. This gate was also referred to as the triumphal arch or the river gate. Noteworthy buildings include the Town Hall, the Herrera Palace, the Temple of San Juan or the Church of Santa Eulalia. A town definitely not to be missed.