Mollongghip is a rural village immediately west of the Wombat State Forest. It is 18 km south-west of Daylesford and slightly less south-east of Creswick.
The undulating landscape of Mollongghip has good agricultural soil. Settlers named it Happy Valley, and the school (1885) had that name for two years before 'Mollongghip' was adopted. The meaning of the name is uncertain.