Rocky Bay
Sharks and Fun...
Rocky Bay is perhaps one of the most famous spots on Koh Tao. If you go snorkelling there you are nearly guaranteed to encounter a batch of friendly Black Tip Reef sharks that hunt their prey (don't worry - small fish) in the shallows. If you are lucky you can see as many as up to five at a time.
Rocky Bay is also an excellent place to just relaxed and lie on the beach. The sand is very white and the water calm and shallow. The beach is usually not very crowded, which is quite surprising but great if you want a bit of seclusion.
Beaches
Jansom Bay (Paradise Bay) A small cove offering solitude and snorkelling. Called Paradise for its crystal clear water, white sand and swaying coconut palms. Protected most of the year it also offers safe swimming for kids.
Mae Haad. The main pier and arrival point for boats to Koh Tao. All basics including restaurants, money exchange, post office, travel agents, boat rental, dive shops, police and clinic can be found.
Sairee Beach. The longest (2-km) and most popular beach, facing the mainland, which can be seen on a clear day. This crescent-shaped, beach has a a good choice of accommodation and places to eat making it a popular spot for travellers. It's also a perfect spot for snorkelling as the coral reef can be found just 100 metres off the beach.
Mae Haad Beach Ideal for kids - very shallow with no traffic. Good for snorkelling - not just lots of tropical fish, but also a large wooden shipwreck stranded on the reef. Location of some of Koh Tao's best resorts.
Chalok Baan Kao Smaller than Sairee beach with a view of the Buddha rock and access to a few adjacent beaches including Ta Toh and Saan Jao. Good for budget accommodation.
Koh Nang Yuan One of those idyllic kind of places. Three islands connected by tiny stretches of sand surrounded by the sea. In order to maintain its unspoilt quality, plastic bottles and other human waste are not allowed on to the island by the main resort.
Rocky Bay, (Shark Bay) has excellent snorkelling opportunities where sharks can be sighted. One unusual resort popular with backpackers (Rocky Resort) is situated in the rocks on the southern side of the bay. The beach is quite small with grass, coconut palms and tropical vegetation right on the edge
Come to think of it, it's amazing how many delightful spots there are to visit on Koh Tao. The island is literally littered with small secluded bays and beaches, numerous small capes and tons of beautiful white sand. You will never have trouble finding a private spot if you rent a kayak or hire a traditional Thai longtail boat to take you around the island. 
Charm and atmosphere... 
The Perfect Beach? 
Colorful Sunsets and great views... 