[5] The founders named the city after Robert E. Lee, who is thought to have set up camp for a time near the current townsite on the Colorado River.

Lee served in Texas from 1856 to 1861 as a lieutenant colonel in the U.S. Army, Second Cavalry.

According to the United States Census Bureau, the city has a total area of 1.1 square miles (2.8 km2), all land.

As of the 2020 United States census, there were 1,027 people, 540 households, and 297 families residing in the city.

About 32.9% of all households were made up of individuals, and 21.8% had someone living alone who was 65 years of age or older.