Short answer
Allah is above His creation, established over the Throne in the way that befits Him, and He is with you by His knowledge wherever you are. Maturidi and Ash'ari scholars add that He is not contained in a place, since place is created. Athari scholars stress that He is above the heavens. Both deny any likeness to creation.
In the Maturidi creed taught in Hanafi institutions, Allah existed before place and time and is not contained by any place or direction. His istiwa (being established) over the Throne is affirmed as the Quran states it, without how, and without likening it to the sitting or settling of creatures.
The four schools agree on this.
Explanation
The Quran says the Most Merciful is established above the Throne (20:5). It also says He is with you wherever you are (57:4) and closer to a person than his jugular vein (50:16). Sunni scholars read these together: Allah is exalted above His creation, and His knowledge, hearing and power reach everything.
Maturidi and Ash'ari scholars, who teach creed in most traditional Hanafi, Shafi'i and Maliki institutions, explain that place and direction are themselves created. Allah existed before He made them, and He does not change. So He is not inside the universe, and He is not in a spot above it as a body is above the ground. They cite the dua of the Prophet ﷺ: "You are the Manifest, nothing is above You, and You are the Hidden, nothing is beneath You." Imam al-Tahawi wrote that the six directions do not contain Him.
Athari scholars take the verses on Allah being above (fawq), and the hadith of the slave girl who answered "in the sky" when asked where Allah is, as affirming that Allah is above the heavens, over the Throne. They also say He is not like creation and nothing contains Him. Maturidi scholars read "in the sky" as pointing to His exaltedness, not to a location. This is an old discussion among Sunni scholars, and the respected scholars on both sides do not call each other out of Islam over it.
For everyday faith the key point is simple: Allah sees you, hears you and is near when you call on Him (2:186). You do not need to picture a place in order to pray. Our page on tawheed explains more.
The evidence
Quran, Surah Taa-Haa 20:5
ٱلرَّحْمَٰنُ عَلَى ٱلْعَرْشِ ٱسْتَوَىٰ ﴿٥﴾
The Most Merciful [who is] above the Throne established.
Affirms Allah's istiwa over the Throne.
Quran, Surah Al-Hadid 57:4
هُوَ ٱلَّذِى خَلَقَ ٱلسَّمَٰوَٰتِ وَٱلْأَرْضَ فِى سِتَّةِ أَيَّامٍۢ ثُمَّ ٱسْتَوَىٰ عَلَى ٱلْعَرْشِ ۚ يَعْلَمُ مَا يَلِجُ فِى ٱلْأَرْضِ وَمَا يَخْرُجُ مِنْهَا وَمَا يَنزِلُ مِنَ ٱلسَّمَآءِ وَمَا يَعْرُجُ فِيهَا ۖ وَهُوَ مَعَكُمْ أَيْنَ مَا كُنتُمْ ۚ وَٱللَّهُ بِمَا تَعْمَلُونَ بَصِيرٌۭ ﴿٤﴾
It is He who created the heavens and earth in six days and then established Himself above the Throne. He knows what penetrates into the earth and what emerges from it and what descends from the heaven and what ascends therein; and He is with you wherever you are. And Allah, of what you do, is Seeing.
Allah's knowledge and care reach every person everywhere.
Quran, Surah Al-Baqara 2:186
وَإِذَا سَأَلَكَ عِبَادِى عَنِّى فَإِنِّى قَرِيبٌ ۖ أُجِيبُ دَعْوَةَ ٱلدَّاعِ إِذَا دَعَانِ ۖ فَلْيَسْتَجِيبُوا۟ لِى وَلْيُؤْمِنُوا۟ بِى لَعَلَّهُمْ يَرْشُدُونَ ﴿١٨٦﴾
And when My servants ask you, [O Muhammad], concerning Me - indeed I am near. I respond to the invocation of the supplicant when he calls upon Me. So let them respond to Me [by obedience] and believe in Me that they may be [rightly] guided.
Allah is near to the one who calls on Him.
Sahih Muslim 2713
Sahih... وَأَنْتَ الظَّاهِرُ فَلَيْسَ فَوْقَكَ شَىْءٌ وَأَنْتَ الْبَاطِنُ فَلَيْسَ دُونَكَ شَىْءٌ ...
"You are the Manifest, so nothing is above You, and You are the Hidden, so nothing is beneath You."
Cited by Maturidi and Ash'ari scholars to show Allah is not bound by place or direction.
Sahih Muslim 537
Sahih... أَيْنَ اللَّهُ قَالَتْ فِي السَّمَاءِ قَالَ مَنْ أَنَا ...
"He asked her, "Where is Allah?" She said, "In the sky." He asked, "Who am I?""
The hadith of the slave girl, which Athari scholars cite for Allah's elevation and Maturidi scholars read as pointing to His exaltedness.
Where the ruling is recorded
- al-Aqida al-Tahawiyya, Section on Allah being free of limits and directions. States that the six directions do not contain Him as they contain created things.
- Sharh al-Fiqh al-Akbar (Mulla Ali al-Qari), Section on istiwa and the Throne. The Hanafi explanation that Allah is above the Throne without being in a place.
- al-Aqida al-Wasitiyya (Ibn Taymiyya), Section on Allah's elevation and istiwa. The Athari position that Allah is above His creation, with no likeness.
This answer is pending review by the scholars on our team. Quran translation by Sahih International. Hadith Arabic from the standard editions of the six books and the Muwatta, with gradings as recorded there; the English is our own rendering. Spotted a mistake? Tell us.