Neptune Bay is a bight about 1.5 miles (2.4 km) wide on the southeastern shore of Kachemak Bay on the Kenai Peninsula, about 9 miles (14.5) southeast of Homer, Alaska. Mermaid Island is in Neptune Bay, on the tidal delta formed by the Wosnesenski River, also known as the McKeon Flats. The island is surrounded by a recurved sand spit on the south shore of the bay. The local name was first reported on charts in the 1940s by the U.S. Geological Survey or the U.S. Coast and Geodetic Survey.

The southern shore of Kachemak Bay includes cliffs and rocky headlands that provide nesting habitat for numerous seabird colonies. Pigeon guillemots nest in approximately 30 small colonies of 2–15 nests each, and numerous solitary nests are also scattered along the shore. At least one colony is located in Neptune Bay. Pigeon guillemots and closely related black guillemots are unique among diving seabirds because they usually forage near the seafloor and within a few kilometers of the nest site. Their preferred prey are small fish and the most abundant in Kachemak Bay are the Pacific sand lance, also called sand eels.

The sand lance is not related to a true eel but looks like an eel because they have a slender body and pointed snout, and do not have pelvic fins or swim bladders. Juvenile sand lances are perhaps the most abundant of all fish larvae and serve as a major food item for cod, salmon, whales, and other commercially important species. As adults, they are bottom-dwelling and live in burrows on sandy habitats to avoid tidal currents. Adult sand lances are an important food source for diving seabirds such as guillemots, puffins, auks, terns, and cormorants. Read more here and here. Explore more of Neptune Bay here: