In the south of the island of Pag, Povljana is situated in a beautiful natural bay. Facing west it is sheltered from strong winds of Bora and sirocco. It offers protection and refuge to both those coming from the sea and from the mainland, to devotees of the island rocks and plants, sunbathed and seasoned with salt. It is located on a hill, where karst rocks and fertile Povljana fields meet.
Owing to plentiful water wells extensive agriculture is possible (vegetable and viticulture). Vast area of fertile land is covered with vineyards. Traditionally, Povljana was an agricultural area that for centuries supplied food to majority of people on the island. In addition to agriculture, the population of Povljana earned their living from fishery and cattle breeding.
Great changes occurred in the middle of the 20th century, when tourism started to develop in Povljana. First records of a great tourist wave dates back to 1954. Hunting tourism developed in Povljana first. Today evidence supporting this theory can be found in the remains of a house in the territory of Veliko blato.
This house belonged to the family Košćina, and this Pag nobility invited hunters from across Europe. What was once a rural land Povljana became a developed municipal centre, reflecting the efforts of the population investing in Povljana and striving to further affirm it as a distinguished tourist destination.