The Liujiaxia Reservoir (Chinese: 刘家峡水库; pinyin: Liújiāxiá Shuǐkù) formed by the dam is the largest body of water within Gansu.

[3] In 1955, just a few years after the creation of the People's Republic of China, the Communist government announced a large-scale program of hydroelectric dam construction on the Yellow River.

[2][5] The reservoirs created by the three-dam cascade (also including Bapanxia Dam (1968-1975) farther downstream) displaced numerous local farmers.

[4] The compensation payments to the farmers affected by the Liujiaxia Dams reportedly averaged 364 yuan per person (but in reality may have been even lower), and were grossly inadequate.

[4] It is said that the residents received lower compensation amount than they could otherwise because in 1958, during the Great Leap Forward, when the Yanguoxia project started, they understated the value of their assets, as they were afraid to be classified as "rich peasants", i.e. class enemies.