The village is located on the shores of the eponymous Lac au Saumon (French for "Salmon Lake") that is an enlargement of the Matapédia River.

It was known as a spawning ground for salmon, but major pollution from mills made this a thing of the past.

But it was not until 1896 that real settlement began with the arrival of a group of Acadians from the Magdalen Islands.

The latter passes on the north side of the lake although the bulk of the village is located to the south.

Lac-au-Saumon's economic development is linked to agriculture and forestry, particularly wood processing.