Dallol lies in the evaporitic plain of the Danakil Depression at the Afar Triangle, in the prolongation of the Erta Ale basaltic volcanic range. The intrusion of basaltic magma in the marine sedimentary sequence of Danakil resulted in the formation of a salt dome structure, where the hydrothermal system is hosted. The age of the hydrothermal system is unknown and the latest phreatic eruption that resulted in the formation of a  diameter crater within the dome, took place in 1926. The wider area of Dallol is known as one of the driest and hottest places on the planet. It is also one of the lowest land points, lying  below mean sea level. Other known hydrothermal features nearby Dallol are Gaet'Ale Pond and Black Lakes.
The hydrothermal springs of Dallol discharge anoxic, hyper-acidic (pH &lt; 0), hyper-saline (almost 10 times more saline than seawater), high temperature (hotter than ) brines that contain more than 26 g/L of iron. The main gases emitted from the springs and fumaroles are carbon dioxide, hydrogen sulfide, nitrogen, sulfur dioxide; and traces of hydrogen, argon, and oxygen. Although several other hyper-acidic (pH &lt; 2) volcanic systems exist, mainly found in crater lakes and hydrothermal sites, the pH values of Dallol decrease far below zero. The coexistence of such extreme physicochemical characteristics (pH, salinity, high temperature, lack of oxygen, etc.) render Dallol one of the very few ‘poly-extreme’ sites on Earth. This is why Dallol is a key system for astrobiological studies investigating the limits of life. Parts of the region are nearly sterile, except for a diverse array of "ultrasmall" archaea.
Dallol is highly dynamic; active springs go inactive and new springs emerge in new places in the range of days, and this is also reflected in the colors of the site that change with time, from white to green, lime, yellow, gold, orange, red, purple and ochre. In contrast to other hydrothermal systems known for their colorful pools (e.g. Grand Prismatic Spring), where the colors are generated by biological activity, the color palette of Dallol is produced by the inorganic oxidation of the abundant iron phases. Another fascinating feature of Dallol is the wide array of unusual mineral patterns, such as, salt-pillars, miniature geysers, water-lilies, flower-like crystals, egg-shaped crusts, and pearl-like spheres. The main mineral phases encountered at Dallol are halite, jarosite, hematite, akaganeite and other Fe-oxyhydroxides, gypsum, anhydrite, sylvite and carnallite.