This lake is located only a few miles from the Pigeon Forge/Gatlinburg area, and also the Great Smoky Mountains National Park.

The Douglas Dam was built by the Tennessee Valley Authority at a record pace from February 2, 1942, through February 19, 1943, to provide hydroelectric power and to control flooding downstream in the Tennessee River Valley.

During the winter months, the Tennessee Valley Authority lowers the water level to help control flooding, meet power demands, and many other objectives.

The resort town of Baneberry is located on the northern shores of the lake in Jefferson County.

Parts of downtown Dandridge are located below the lake's operating levels, and are protected by an earthen dam.