The dam is in Washington state, while Ross Lake extends 23 miles (37 km) north to British Columbia, Canada.

Built as part of the Skagit River Hydroelectric Project by Seattle City Light, the dam is part of a series of three dams through the Skagit Gorge that were built primarily to generate hydroelectricity from the massive elevation drop of over 1,000 feet (300 m) from the Canada-U.S. border to Newhalem.

While the reservoir filled, the Decco-Walton Logging Company was formed in 1945 with the awarding of a contract from Seattle City Light.

By the time Ross Lake filled, only 30 million board feet remained in the basin, less than 10% of the original timber.

This height would cause the reservoir at full pool to extend slightly past the Washington-British Columbia border.

As compensation for the flooded land, which totals about 500 acres (2.0 km2), Seattle City Light paid the Province of British Columbia $250,000, as well as an annual payment of $5,000.

The stepped "concrete waffle" facing on the front of the dam was designed to accommodate this addition to the height.

[6] This would have flooded land into Canada approximately 3 miles (4.8 km) further, also extending up the Klesilkwa River, a Skagit River tributary, and provided the opportunity to generate about 272 MW of extra power, bringing the generating capacity to 732 MW.

The North Cascades mountains rise nearly 5,000 feet (1,500 m) vertically from the floor of the canyon and surround it on both sides.