Ocean physics is a key aspect of the operation of island ecosystems, yet the hydrodynamics is sometimes poorly understood. A high-resolution oceanographic survey to the north of South Georgia identified two water masses. These are South Georgia Shelf Water (SGSW) and Antarctic Zone Water (AZW). At the surface, SGSW is both colder and fresher than AZW; at the near-surface temperature minimum these differences are reversed. There are two causes: SGSW is close to the island and has an additional contribution to the heat and salt balance from increased precipitation and island runoff, and second, AZW has advected from higher latitudes. Both of these mechanisms imply SGSW is retained around the island. Between these water masses is a variable width frontal region that has a mixture of both water masses. In general terms, the mean current of the AZW is to the west. In the SGSW the general flow also appears to be to the west, but at reduced magnitude; there is evidence of a stronger westerly current close to the shore. In both water masses there are easterly surface currents most likely driven by the prevailing wind. An approximation for the limit of SGSW is that it is constrained to water depths <500 m. A significant deviation is caused by an anticyclonic flow around a prominent bank that can be associated with significant upwelling. Finally, we comment on the ecological significance of the system observed. ¿ 2000 American Geophysical Union