In the local Nyungar language, the lake was originally called Kou-Gee, which was first recorded by European settlers in 1841 and variously spelled as Koojee, Coojee and Coogee.

[1] The lake had and has mythological significance to the local indigenous people, the Noongar people, who associate it with two birds who stole fire from the moon which, in turn, caused a bushfire that was extinguished by the rising ocean, which had been called to assist by the moon.

The event is associated with the drowning of Noongar people and the formation of the lake.

[2] Lake Coogee was formed approximately 10,000 years ago after the last ice age.

A footbridge running just north of the lake, separating the lake from the Market Garden Swamp further north, was proposed in 1998 and constructed to hold sewage pipes running to the water treatment plant at the western shore.