The Painted Rock Dam was constructed during a 3-year period from 1957–1960 by the United States Army Corps of Engineers to help control seasonal floods on the lower reaches of the Gila River.

Near the dam site, there is also a campground maintained by the Bureau of Land Management that showcases a number of prehistoric petroglyphs, indicating human involvement in the region long predating Western influence.

The reservoir, with a maximum storage capacity of 2,491,700 acre-feet (3.0735×109 m3), has the potential to be the second largest reservoir completely within the borders of the state of Arizona, but because the Gila River and its main tributary, the Salt River, are generally almost always completely diverted for irrigation and municipal water use for Phoenix, the lake is often dry.

However, extremely high levels of pesticides, particularly the now-banned DDT, had built up in the farmlands upstream from the reservoir in the decades prior and accumulated in the lake during the flood.

Water impounded by the Painted Rock Dam caused the flooding of about 10,000 acres of the Tohono O'odham's Gila Bend Reservation.