Pengilly is an unincorporated community in eastern Itasca County, Minnesota, United States.Located in the northern part of the state, the community lies in the Iron Range region at the northern end of Swan Lake. Pengilly is located between Grand Rapids and Hibbing at the junction of U.S. Highway 169 and Minnesota State Highway 65. The expressway section of U.S. 169 that travels between the cities of Virginia and Hibbing currently ends in the community of Pengilly.