The current town is based around the village built to support the dam construction from 1942 to 1944, so that the dam could produce electricity to power the ALCOA (Aluminum Company Of America) in nearby Alcoa, Tennessee which is south of Knoxville.

The company was producing aluminum to make military aircraft during World War II.

[6] The property was transferred to Guest Services of America (GSA) then sold to Peppertree Corporation of Asheville NC in 1987.

The CEO, Wayne Kinzer was later convicted of a felony and the property changed hands several times thereafter.

[9] The town's main employer is the Fontana Village Resort, which serves 100,000 visitors annually.