You won't find the crossbow in Alan Wake 2 until you start exploring Watery, an area not far from the town of Bright Falls. You'll start seeing clues to the existence of the weapon as you get closer to the weapon's location, by way of crossbow bolts stuck in trees. The first confirmation that it exists, however, is the note stuck to the top of a Cult Stash in Watery.
As with any self-respecting survival horror game, it pays to have a couple of weapons with you: ammo is scarce, but in the case of the crossbow, you can retrieve the bolts after shooting them. And, of course, one shot does a huge amount of damage, so it's useful to have on you if you're going up again some of the tougher Taken. With that in mind, here's where to find the crossbow in Alan Wake 2.
Alan Wake 2 crossbow location: Where to find it
The crossbow is found inside one of the Cult Stashes on the east side of Watery, before you get to the Coffee World area. Look for the container outside the Hunting Shack there—it's a safe house so you shouldn't miss it. You'll know you've got the right one because the note on top of the stash mentions the crossbow. As with other Cult Stashes, this one is locked with a combination padlock.
To get the code, look at the numbers on the fencing nearby. You'll notice that some have crossbow bolts shot into them and this is your clue. The first number of the code has one bolt, the second has two, and the third has three crossbow bolts. The crossbow combination is 527.
Use this number on the padlock and the box will spring open, revealing the crossbow inside. Retrieve your reward and don't forget to pick up the crossbow bolts while you're at it. Ammo is scarce, remember?