Terrace Bay is a small town located in the Thunder Bay District of Ontario, Canada. It is situated along the northwestern shore of Lake Superior. The town has a population of approximately 1,600 people. Terrace Bay is known for its beautiful natural surroundings, including the nearby Batchawana Bay and Aguasabon Falls. It is also a popular destination for outdoor activities such as fishing, hiking, and boating. The town's economy is primarily based on industries such as forestry and tourism.