Most of the story takes place near Lake Lachrymose, where the children are sent to live with their Aunt Josephine. The word "lachrymose" means "tearful" or "weepy," and the setting is rainy and glum (and even features two hurricanes). Adding to the bleakness, the nervous and recently widowed Aunt Josephine apparently kills herself by jumping out of a wide window soon after the children arrive.
Lake Lachrymose, near a very unpleasant town, is huge and inky black, and the children can understand why Aunt Josephine is afraid of it. Aunt Josephine's house, which looks over the lake from the top of a steep hill, also seems frightening to the children, because it appears ready to fall into the lake. It is described as
a large pile of boxy squares, all stuck together like ice cubes hung over the side, attached to the hill by long metal stilts that looked like spider legs. As the three orphans peered down at their new home, it seemed as if the entire house were holding on to the hill for dear life.
The orphans will later cross the lake to arrive at the Curdled Cave, where they will find Aunt Josephine, who has not killed herself but has been kidnapped by Count Olaf.