Dermati is located on the southern slopes of Mount Chelidona. To the south of the village is the confluence of the Karpenisiotis and Krikeliotis rivers, while to the southeast and near the provincial road Karpenisi - Proussos - Kallithea is the gorge of the Black Cave.
The village is 26 km southwest of Karpenisi and 13 km northeast of Proussos. Due to the rugged and harsh terrain, most of its inhabitants relocated to Neo Mikro Chorio and founded Neo Dermati. It was first recognized as a community in 1919 and belonged to the prefecture of Aetolia-Acarnania. Today, it constitutes the local community of Dermati, which belongs to the municipal unit of Potamia in the Municipality of Karpenisi.
The first official document recording the village under its current name, Dermati, is a tax register from the administrative region (sanjak) of Trikala dating back to 1454/1455 AD, which administratively and fiscally included the regions of Agrafa, Karpenisi, and Kravara.