<P> The series predominantly takes place in the benthic underwater city of Bikini Bottom which, according to some third - party sources, is located in the Pacific Ocean beneath the real - life coral reef known as Bikini Atoll . In 2015, Tom Kenny confirmed that the fictitious city was named after Bikini Atoll, but denied an Internet fan theory that connected the series' characters to actual nuclear testing that occurred in the atoll . </P> <P> The citizens live in mostly aquatic - themed buildings and use "boatmobiles", amalgamations of cars and boats, as a mode of transportation . Recurring establishments present in Bikini Bottom include two competing restaurants, the Krusty Krab and the Chum Bucket; Mrs. Puff's Boating School; and Shady Shoals Rest Home . Goo Lagoon, a popular beach hangout, is within the vicinity of the city, as is Jellyfish Fields . </P> <P> When the crew began production on the pilot, they were tasked with designing the stock locations where "the show would return to again and again, and in which most of the action would take place, such as the Krusty Krab and SpongeBob's pineapple house". The idea for the series was "to keep everything nautical", so the crew used a great amount of rope, wooden planks, ships' wheels, netting, anchors, boilerplates, and rivets in creating the show's setting . Bubbles filing up the screen is also a nautical technique used to transition from scene to scene . </P> <P> The series features "sky flowers" as a main setting material . They first appeared in the pilot and have since become a common feature throughout the series . When series background designer Kenny Pittenger was asked what they were, he answered, "They function as clouds in a way, but since the show takes place underwater, they aren't really clouds . Because of the tiki influence on the show, the background painters use a lot of pattern ." Pittenger said that the sky flowers were meant to "evoke the look of a flower - print Hawaiian shirt". </P>

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