A historically important lake, it formed a vital part of the medieval trade route from the Varangians to the Greeks.

The city of Veliky Novgorod, which is a major trade center of the route, lies six kilometres (3.7 mi) below the lake's sole outflow, via the Volkhov River.

[2] Yuri Otkupshchikov has argued that the presence of the name "Ilmen" in Southern Russia cannot be explained by Novgorodian colonisation alone, and proposed a Slavic etymology instead.

It is drained through a single outlet, the Volkhov, into Lake Ladoga, and subsequently via the Neva into the Gulf of Finland.

The lake area was the location of an important battle during World War II, the Demyansk Pocket.