We assess tsunami hazards in San Diego Bay, California, using newly identified offshore tsunami sources and recently available high resolution bathymetric/topographic data. Using MOST (Titov and Synolakis, J Waterways Port Coastal Ocean Eng ASCE 124(4):57–171, 1998), we simulate locally, regionally and distant-generated tsunamis. Local tsunami source models use more realistic fault and landslide data than previous efforts. With the exception of the Alaska-Aleutian Trench, modeling results suggest that local sources are responsible for the largest waves within the San Diego Bay and Mission Bay. Because San Diego Bay is relatively well protected by North Island and the Silver Strand, the wave heights predicted are consistently smaller inside the harbor than outside. However, historical accounts, recent tsunamis and our predictions show that San Diego Bay is vulnerable to strong tsunami induced currents. More specifically, large currents are expected inside the harbor for various distant and local tsunami sources with estimated flow velocities exceeding 100 cm/s. Such currents have been damaging to harbor facilities, such as wharves and piers, and may cause boats to break from moorings and ram into adjacent harbor structures, as observed in recent historic tsunamis. More recently, following the Mw 8.8 February 27, 2010 Chile earthquake, tsunami-currents damaged docks/piers in Shelter Island confirming our findings. We note that the first generation of inundation maps in use in San Diego County by emergency management was based on much larger “worst case but realistic scenarios” (Synolakis et al. 2002a), which reflected the understanding of offshore hazards pervasive ten years ago. Large inundation and overland flow depths were observed primarily in local tsunami source simulations. In particular, locally induced tsunamis appear capable to overtop the Silver Strand. The results suggest that further work needs to be carried out with respect to local tsunami sources as they seem to have worse impact in the San Diego region than previously thought but probably low probability of occurrence. We also predict that a coastal community can be devastated simultaneously by large waves inundating shores and large currents in locations with small flow depths.