Blue Lake's valley contains the best-developed glacial features in the Kosciuszko National Park alpine area of New South Wales.

[4] The lake was formed when glaciers flowing from the Great Dividing Range converged and carved out a basin in the granite bedrock.

Rare or threatened plants found within the Ramsar site include the branched carraway, wedge oschatzia and snow-wort, as well as the endangered ecological community of Montane Peatlands and Swamps.

Threatened animals found there include the mountain pygmy possum and broad-toothed rat as well as the critically endangered fish the Kosciuszko galaxias.

Human activities in the area include environmental education, bushwalking, skiing, and ice climbing.