The city is a commercial and tourist center for the surrounding rural areas.

American Indians lived around Rice Lake for millennia, some of whom made mounds like those that remain in Indian Mounds Park along the shore of the lake.

[7] In later years before white settlers, Ojibwe (Chippewa) people occupied the area, and they had a strong cultural attachment to the wild rice that grew on the lake.

[8] In the mid-1860s Knapp, Stout & Co., the growing lumber company downstream at Menomonie, bought tracts of forest around Rice Lake.

[6][9] Around 1868 the company started a logging camp in the area[10] and in 1870 the company dammed the Red Cedar to raise the level of Rice Lake to make a better holding pond for their logs.

The higher water disrupted the existing wild rice beds, angering the Ojibwe.

The company built a small water-powered sawmill for sawing local lumber and a gristmill.

In 1887 the Rice Lake Lumber Company opened, owned by Orrin Henry Ingram of Eau Claire.

It expanded Knapp-Stout's sawmill, added two planing mills, and employed 200.

The lumber companies set up electric lights and a water utility in 1892, which were taken over by the city in 1910.

39.3% of all households were made up of individuals, and 17.6% had someone living alone who was 65 years of age or older.

[17] Rice Lake Area School District operates public schools: Rice Lake serves as a shopping, industrial, educational, and medical hub for the surrounding rural communities of Barron, Cameron, Chetek, Shell Lake, Cumberland, Spooner, and Ladysmith.

[17] The largest source of revenue for the city is property taxes, with $430,000 of income.