The population of Trout Lake grew after the construction of the Rio Grande Southern Railroad and the nearby Ames Hydroelectric Generating Plant in the 1890s.

In the spring of 1831, the St. Louis Fur Company employed a party of 60 men under the command of Colonel William G Walton to trap beavers and other fur-bearing animals along the headwaters of the San Juan River.

The party spent the summer of 1833 in the valley of the Rio Dolores and at Trout Lake before continuing their journey northward.

[8] On June 13, 1905, Trout Lake became a part of the newly created Montezuma Forest Reserve with the signing of Proclamation 575 by Theodore Roosevelt.

[12] The collapse of the dams released approximately 2,000 Acre-feet of water downstream, killing livestock, destroying miles of railroad track, and flooding the nearby towns of Placerville, Sawpit, and Newmire.

[19][12] The scene along the [San Miguel] river Monday morning as the waters had partially receded forbids intelligent description.

[5] Today, the area around the lake features multiple hiking trails, which in the winter are groomed by the Telluride Nordic Association to be used for cross-country skiing.