Shafer Township is located in southeast Chisago County, bordered to the east by the city of Taylors Falls and the St. Croix River, which is the Minnesota–Wisconsin border. The city of Shafer is in the southwest part of the township but an administratively separate entity. The unincorporated community of Palmdale is in the north.

U.S. Highway 8 follows most of the southern boundary of the township, turning northeast to travel to Taylors Falls, then across the river to St. Croix Falls, Wisconsin, and leading west to Lindstrom and Chisago City. State Highway 95 (MN 95) crosses the north part of the township, passing through Palmdale and leading southeast to Taylors Falls and northwest to North Branch.