Horseshoe Bay is the small, sheltered beach in the centre of Bermagui, right beside the main street and just north of the fishing harbour. It is a family swimming beach and a popular snorkel. No dive directory describes it in detail. The site-guide aggregator Scubago lists a Horseshoe Bay dive described as shallow but beautiful, easy to navigate, rarely with current, and needing a high-tide entry because it is otherwise extremely shallow – but its page does not clearly identify the location, so that description may not refer to Bermagui.

The bay has a sandy bottom with patches of weed and seagrass and rocky edges at either end. It is the kind of habitat where snorkellers find juvenile fish, bream, whiting, leatherjackets and small wrasse, with stingrays and fiddler rays on the sand and octopus and nudibranchs in the rocks. Bermagui's nearby Blue Pool tidal rock pool is known for nudibranchs, and Peter Fuller recorded about eight species there, which suggests a rich invertebrate fauna along this coast.

The site suits snorkellers, children and new divers on calm days. It is right in town, with cafés and toilets a few steps away. Its shelter from southerly swell makes it useful when other sites are closed. It is also a pleasant post-dive swim after a boat trip from the harbour.

Horseshoe Bay is in the middle of Bermagui, beside the main street and just north of the harbour. Park on Lamont Street or in the foreshore car parks and walk down to the beach. Enter from the sand and swim out towards the rocks at either end.

The harbour boat ramp is a short distance south – stay clear of the harbour entrance.

The bay faces north-east and is sheltered from southerly swell, which makes it a good option in southerly weather. North-easterly winds and swell make it choppy. It is very shallow at low tide, so dive or snorkel around high tide.

Visibility falls after rain and in north-easterly seas.

Enter at high tide, swim over the sand to the rocks at one end and follow them at 2–5 m, looking in the weed for small fish and invertebrates. Return along the sand. Stay well clear of the harbour entrance.

No dive operator is based in Bermagui; Narooma and Sapphire Coast operators occasionally guide visiting groups. Mostly snorkellers and families.