The forest was established in 1933 by the Civilian Conservation Corps with the purchase of 1500 acres of land at the mouth of the Yellow River.

The State and the various Federal agencies actively cooperate in the management of the lands under their care, particularly in the use of fire to maintain goat prairies, which are found "on steep, thin soils with a south-southwest exposure.

The best examples occur in northeast Iowa's Paleozoic Plateau, but similar prairie can be found in other parts of the state.

The Yellow River and Paint Creek have rugged, steep walled canyons, showing millennia of erosion, where glacial action would have otherwise smoothed out the features.

About 150,000 board feet (350 m³) of lumber is annually harvested in the forest and processed by inmates at the minimum-security Luster Heights Prison Farm.