Vrsar is situated at the same mouth of the Lim Channel, on a 54 metres high hill. The original settlement was set on the very top of the hill. The original settlement was set on the very top of the hill, but later on it spread down the hill slopes. The present-day Vrsar has developed along the sea - shore. It is surrounded by romantic islets and cliffs named Figarolica, Lakal, Salamon, Zavata, Galiner, St. Juraj, Longa, Gusti Školj, Tuf, Galopon, Koversada and Orlandin. To the north the harbour is bounded by the promontory called Montraker.
The name Vrsar (Italian: Orsera) is very old. In Medieval Latin documents the name appeard in different variants: Ursaria, Ursarium, Vrsarium, Orsaria... The name Ursaria was even used for the whole coastline between the village Funtana and the Lim Channel. According to some linguists, the old Mediterranean word ''ur'' meaning ''water spring'' has been preserved in the root of the name Ursaria. Namely, while sailing along the western coast of Istra the ancient sailors were providing themselves with drinking water from the spring between Funtana and Vrsar and so the name Ursaria emerged. In the Roman and Byzantine times Vrsar was known under that name. In the early Middle Ages the Slavs (Croats) adjusted the ancient name to their pronunciation. In the Croatian version ''u'' was converted into ''v''. The ending ''ia'' disappeared, what resulted in the Croatian name ''Vrsar''.
The Italian name Orsera has developed basing on the old name Ursaria. Pietro Coppo, an Italian geographer living in the 16th century, connected by mistake the name Orsera eith the patrician family Orsini, claiming that a mamber of this family settled down in Vrsar and gave the name to the town. The explanation of Orsera being named after the archbishop Urso from Ravenna is likewise wrong.