[1] The dam impounds the Hiwassee Lake of 6,000 acres (2,400 ha), and its tailwaters are part of Apalachia Reservoir.

[9] The Hiwassee River flows northwestward from its source in Towns County, Georgia through Western North Carolina, where it proceeds to slice a scenic valley through the southern Appalachian Mountains en route to its mouth along Chickamauga Lake in Tennessee.

[1][5] Hiwassee Lake stretches along the river for approximately 22 miles (35 km) to the town of Murphy, North Carolina.

It used an energy-generating turbine that was run in reverse during low-demand hours to pump water from below the dam into the upper reservoir.

The cities of Andrews and Murphy in North Carolina had already established minor dams with generating capacities along the river when major power companies began planning large-scale hydro projects in the valley in the 1920s.

The Carolina-Tennessee Power Company (later reorganized as the Southern States Power Company) purchased 10,000 acres (4,000 ha) of land and flowage rights along the river in 1924 in hopes of building a large dam just above the present dam site, but the project was never fully developed.

Original plans called for a $13 million dam 185 feet (56 m) high with a 4,000 foot (1,200 m) tunnel.

The blocks' joints were formed with shear keys, and pipes were installed to allow future grouting should it become necessary.

Several practices were employed to avoid trapping heat in the setting of the concrete, including the use of low-heat cement.

[1] Hiwassee Dam's gates were closed on February 8, 1940, although minor construction work continued until later that same year.