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Ysgol Penllwyn takes its name from a Roman Fort that was located on the hill above the school. It is located in the middle Penllwyn, in the village of Capel Bangor, in the north of Ceredigion. It lies on the north bank of the river Rheidol, about 5 miles east of Aberystwyth. The A44 road runs through the village. The village has a railway station on the Rheidol Valley Railway, located over the bridge of the the Rheidol River. The school serves the neighbouring villages of Cwm Rheidol, Aberfrwd and Goginan.

There are traces of inhabitants in the area from the Bronze Age. After a period of fine weather, the remains of a burnt burial mound can be seen clearly on the canvas of Goginan's fields. Our pupils were lucky enough to discuss this on the BBC program 'The One Show' a few years ago.

At the foot of the entrance to the school is Penllwyn Chapel. This was the location of the old schoolhouse where the children of the area received their education before the current school building was built in the 60s. On the grounds of the Chapel there is a statue of the famous Lewis Edwards, minister, philosopher, teacher and first headteacher of Coleg y Bala.

Agriculture is the main industry in the area, with others travelling to work in Aberystwyth town. The rural nature of the area has a clear influence on pupils' interests.

Although the village is small, it has a Pub, 2 garages, a hall, a Riding School and the lovely St David's Church, as well as a range of holiday accommodation. An Agricultural Show is held annually in the village, and the Aberystwyth Show and the Big Tribute Festival are held on fields just outside the village.