The outflow stream goes underground after approximately 500 metres (1,600 ft) before emerging downstream of Malham Cove as a source of the River Aire.

Situated in a limestone area, Malham Tarn itself mainly lies on a bed of silurian slate which is covered with marl deposits.

It used to be about twice its current size, having shrunk due to silting at the western shore; this has formed a boggy region called Tarn Moss.

The lake is home to six species of fish, as well as white-clawed crayfish, great crested grebes, moorhens, coots, tufted ducks and teal.

[15] Last seen fifty years ago, captive-bred water voles (Arvicola amphibius) were reintroduced in August 2016.

[19] There has been human activity at Malham Tarn dating back to the Mesolithic era when the shores of the lake were used for camping during hunting trips for deer and wild cattle.

A survey undertaken in 1539 at the time of the dissolution of Fountains Abbey makes note of a farmstead on the northern shore of the lake.

[21] Following the dissolution of the monasteries, the estates of Malham Moor then changed hands several times until they were eventually acquired by Thomas Lister—later to become the first Lord Ribblesdale—in the mid- to late-18th century.

While visiting Walter Morrison in 1858, author Charles Kingsley was inspired to write the Victorian era novel The Water-Babies, A Fairy Tale for a Land Baby.

The site also serves as a base for the National Trust's team of Rangers, as well as staff working on the 'Heart of the Dales' Landscape Recovery scheme.