The initial purpose of the dam from its establishment until its decommissioning during the 1970s was for the supply of potable water to the Gold Coast region.

The Tallebudgera Dam is located approximately 16 kilometres (9.9 mi) south west of the Burleigh Heads.

Following introduction of the Water Act, 2000 (QLD), a Failure Impact Assessment noted the dam design did not comply with the latest safety standards and may over top during a 1 in 50 year average recurrence interval.

[3][4] Options considered were to permanently lower the level of the spillway, install flood-triggered gates and removal of the dam.

In 2006, after two years of investigation, reports and public consultations, work commenced to upgrade the existing dam to the required standards.