The reservoir was formed in 1931 by the construction of a dam to provide hydroelectric power to the area.

Lake Wood served as a venue for outdoor recreation, including fishing and boating.

On March 10, 2016, after substantial rainfall, one of the reservoir gates failed, essentially draining Lake Wood.

Fish that were present in Lake Wood include catfish, white crappie, sunfish, and largemouth bass.

The Guadalupe-Blanco River Authority maintains a 35-acre (14 ha) park with a store on the lake with facilities for camping, canoeing, and fishing.