Labuan island is located 115 km south of Kota Kinabalu and 8 km off the mainland of Sabah at the northern mouth of Brunei. Its deep harbour and duty free port attract shipping from all over the world and in 1990, Labuan was declared the International Offshore Finance Centre of Malaysia. its history which has always been intimately entwined with maritime traffic, begun over three centuries ago with the first commercial transactions between Chinese junk owners and the Sultan of Brunei.

Since then, Britain and other countries have used Labuan as a trading and fuel station and then during World War 11, Labuan was the scene of bitter conflicts between the Japanese and Allied air and Naval forces. Although three islands, Pulau Kumaran, Pulau Rusukan Kecil and Pulau Rusukan Besar are designated as Marine Parks, the special underwater attractions of Labuan are its shipwrecks.

Four well researched and regularly dived wrecks to the southwest make this area 'the wreck diving centre of Malaysia. Two of the wrecks are from World War 11, the US Navy minehunter, USS Salute known as the "American Wreck" and the Dutch vessel SS De Klerk known as the "Australian wreck", which was thought to have been sunk by the Royal Australian Air Force. The other two wrecks were sunk in the 1 1980's, the Philippine stern trawler MV Mabini Padre, locally called the "Blue Water Wreck" and the Tung Hwang, a Japanese freighter locally known as the "Cement Wreck". All four ships lie in 30m‑35m of water, with the top portions between 8m‑12m. The water visibility varies greatly season to season from 6m‑20m.

The type of diving on these wrecks ranges from novice to experienced wreck diving with penetrations possible into the hulls. Diving the wrecks can be arranged through Borneo Divers who have a PADI 5 star Dive centre located at Labuan. Here they run PADI courses from Discover Scuba to Divermaster, also catering for TDI Nitrox and Advanced Wreck Diving courses.