To the north the lagoon is connected to the Moraleda Channel, to the south lies the Ofqui Isthmus.

To the west and east lie the Taitao Peninsula and the Northern Patagonian Ice Field respectively.

The lake was formed by the retreat of the San Rafael Glacier in the Northern Patagonian Ice Field.

[1] Antonio de Vea entered San Rafael Lake through Río Témpanos (Spanish for "Ice Floe River") without mentioning any ice floe but stating that the San Rafael Glacier did not reach far into the lake.

This has been interpreted to reflect that the effects of the Little Ice Age were not yet to be seen in the lake the late 17th century.