Melsted is located slightly south of Gudhjem, on the eastern side of Bornholm. Melsted is a cosy little sandy beach that stretches from Melsted harbour to Badehotel. The beach is surrounded by rocks with fine sand and clear water.
At one end of the beach, a small stream flows into the sea where children can play by building dams, and at the other end there is a swimming pier.
There are several parking spaces at Melsted beach both along the road and in the town itself.