It runs for 66 miles (106 km) in the rugged country of Deschutes and Klamath counties on the east side of the Cascade Range.

The route is so named because it weaves past a number of small natural lakes along the Cascades as well as several reservoirs on the upper Deschutes River.

Bachelor Ski Area, then south along the Cascades into northern Klamath County, where it terminates on its southern end at its junction with Oregon Route 58, approximately 40 mi (64 km) southeast of Oakridge.

The Cascade Lakes Scenic Byway continues south along the west side of Mount Bachelor.

It eventually crosses the river, runs north for several miles, and then terminates at an intersection with US 97 near the resort community of Sunriver.