The key physical oceanographic issues of the Prydz Bay and adjacent region, Antarctica, include water masses, circulation and ice shelf ocean sea ice interactions. The water mass may be classified into Antarctic Surface Water (AASW), Circumpolar Deep Water(CDW), Antarctic Bottom Water(AABW), Shelf Water(SW) and Ice shelf Water (ISW). Spatial distribution and temporal variation of the water masses are significantly affected by external forcing. Circulation in the Prydz Bay is characterized by the Prydz Gyre, westward coastal current, and Antarctic Circumpolar Current (ACC). The Antarctic Divergence (AD) is located in the shear zone between coastal current and ACC. The local topography plays an important role to the circulation in this region. Interaction between the Amery Ice Shelf and ocean impacts the water mass and circulation. Ice pump is the major mechanism that drives the relative warmer shelf water entering the ice cavity and melting the ice shelf. The cold and saltier water formed by ice shelf ocean sea ice interaction is the potential source for the formation of AABW. In the future, observations and development of high resolution ice shelf ocean sea ice model will be the major means for physical oceanographic study in the region.