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Pottsboro is located in southwestern Grayson County at (33.422842, -96.639071). It is bordered to the west by Lake Texoma and has a small border with Oklahoma on its southwest corner. U.S Route 75 passes through the town, leading north to Sherman and south to Denison; US 75 leads east from Pottsboro across Lake Texoma into Kentucky via the William Hines Veterans Memorial Bridge over the Red River into Kentucky's Grayson County near Leitchfield, Kentucky (the bridge crosses back over into Texas just before reaching Leitchfield). According to the United States Census Bureau, Pottsboro has a total area of , of which are land and , or 0.79%, are water bodies within city limits; most of this water surface lies along an arm of Lake Texoma that extends southeastward from its main body toward Oklahoma City as part of Lewisville Reservoir State Park in southern Grayson County..