The dam was intended to impound a relatively small reservoir in the central portion of Marble Canyon to develop hydroelectric power.

Although first proposed in the 1920s to generate hydroelectricity, work did not begin until the dam was incorporated as part of the U.S. Bureau of Reclamation (USBR)'s Pacific Southwest Water Plan in the 1940s for its Central Arizona component.

The two dams would have operated as "cash register" facilities to provide funds for future reclamation projects through the sale of cheap hydropower.

This water would be released through a 22 megawatt power station at the base of the dam, with an annual energy production of 164 million kilowatt hours.

[6] Together, the two dams would utilize most of the 1,900-foot (580 m) elevation drop between Lee's Ferry and Lake Mead, which represents one of the biggest untapped hydroelectric potentials in the United States.

The power station at Deer Creek would have been at the head of the reservoir backed up by the never-built Bridge Canyon Dam.

[1][3] The two dams would be operated as "cash register" power plants, meaning that sale of hydroelectricity would pay for their construction cost as well as provide funds for future reclamation projects.

[10] Although the Bureau of Reclamation expressed interest at this time in developing hydroelectric generation at the Marble site, these plans were postponed in favor of building the Hoover Dam, which would provide a much greater storage capacity for irrigation and flood control.

A 25-mile (40 km) road had to be built to connect the nearest highway to "one of the most inaccessible damsites ever explored by Bureau of Reclamation engineers".

In 1965 a Bureau of Reclamation report concluded that solution cavities in the upstream limestone would prevent the reservoir from holding water.