It is located at the junction of modern day North Bloomfield, Back Bone and Lake City Roads.

In 1857, the Irwin ditch, which brought water from Poorman's Creek about twelve miles away, reached town, and it began to boom as a center for hydraulic mining.

[4] In 1858, the Eureka Lake Co., which had taken over the Irwin ditch, laid out a town, anchored by its district office.

[12] By 1880, the town had been reduced to one hotel, one store, one saloon, a blacksmith shop, a livery stable and several homes.

[17] Julius Poquillon, a prominent miner and engineer on the Ridge, opened the Lake City Hotel, complete with French restaurant, in 1858.

[19] In 1866, P. A. Paine, a native of Painesville, Ohio,[20] bought 300 acres in Lake City and took over the Bell Brothers/Arnold hotel.

[22] Francis M. Pridgeon for many years was the elected member of the county Board of Supervisors for District 3, which included much of the Ridge.

William and Bridget Waldron owned the town's general store and stable and had a number of other prominent positions.

[24] As with many mining communities, fire was a constant threat, and Lake City experienced several major ones.

[36] The area was considered part of the North Bloomfield mining district, which was located on auriferous gravel beds which ran down the San Juan Ridge, and often branched out.

One rich branch ran from N. Columbia through Lake City and on towards Red Dog and You Bet.

Taking advantage of its strategic location at the junction of the principal roads between Nevada City and many of the mining communities on the San Juan Ridge, and later on one of the roads to the Henness Pass and the Nevada mines, Lake City was an important transportation stop for travelers and teamsters.

[47] Built in 1855, the Bell Brothers hotel continued for many years, operated in turn by Henry Arnold, P.A.

Mr. Kropp ran it for many years into the 20th century, attracting visitors with a 13 rattle "monster" rattlesnake on display.

In 1886, a local newspaper reported that "Lake City, like nearly all the hydraulic mining towns in this county, looks much like a deserted village.

[54] In 1939, an observer reported that: “A picture of decay is LAKE CITY, ... where two or three decrepit houses and a forlorn hotel (1855), its balcony sagging drunkenly, huddle by the grassy depression in the pasture which was once the "lake.”[55] Today, it is a very rural outpost with a few ranches and residences and a vineyard planted about 30 years ago.