Settled earlier than Goulburn, Bungonia lost its commercial significance after Major Mitchell made the decision in 1833 to re-route the Sydney-Goulburn Road and bypass the village.

Bungonia is now a pleasant stopping place on the way to the Bungonia State Recreation Area. The village boasts many fine examples of early historic buildings. These include: St Michaels Catholic Church (1849), Courthouse (c. 1834), Christ Church Anglican (1839), Hope Inn (1837-71), Victorian Inn (1872-1919) and the Post Office (1942-1974).

A further 10 kilometres from the village is the Bungonia State Recreation Area, one of the oldest conservations reserves in NSW. Adventure caving is one of Bungonia's best known activities, with the caves here being amongst the deepest on the Australian mainland. They should however only be entered by well equipped, experienced cavers.

Bushwalking is also popular with spectacular views being available from a number of lookouts in the area. Longer walks can be undertaken to Bungonia Gorge and the Shoalhaven River. Rock-climbing, canyoning, abseiling and picnicking are other recreation activities within the Bungonia State Recreation Area.