The Tolay Creek watershed lies between those of Sonoma Creek and the Petaluma River. It originates near Stage Gulch Road (part of State Route 116) about  north of Lakeville, California.
The Tolay Creek watershed is part of the hydrological system that includes Sonoma Creek and the Petaluma River. It begins near Stage Gulch Road (part of State Route 116) approximately north of Lakeville, California.