The park is located outside Eagle Nest, approximately 30 miles (48 km) east of Taos.

The lake itself is a man-made reservoir created when the Cimarron River was impounded by the Eagle Nest Dam in 1918.

Before this, the St Louis, Rocky Mountain and Pacific Railroad did some grading work in 1907 on an unfinished extension from its terminus at Ute Park to Taos, including boring a tunnel here.

[2] The lake is home to several species of fish, including rainbow trout, brown trout, kokanee salmon, yellow perch, common carp, white sucker, and northern pike, which were introduced into Eagle Nest Lake (by law, anglers must harvest/keep pike, because of their threat to the lake's gamefish populations).

The surrounding mountains are rich in wildlife such as elk, deer, turkeys and bears.