Coonabarabran is located halfway between Dubbo and Tamworth on the Newell Highway. With the largest Astronomy complex in NSW (Siding Spring), Coonabarabran is the Astronomy Capital of Australia. It is an important centre for the surrounding farming community with the main farming industries being sheep and wheat, although cattle and other grains are also grown.

There is also a thriving timber industry in the Pillaga Forest near Baradine, to the north-west of Coonabarabran. Nowadays, tourism provides a vital source of income for the area. To cater for visitors there are some dozen motels and three hotels, as well as several bed-and-breakfast establishments and two caravan parks.