It was created on the Beli Rzav river as a reservoir for the Bajina Bašta II reversible hydro power plant.

During converse conditions, water runs back from the Zaovine Lake into the Drina, producing electricity by turning the turbines inside the pipeline.

The shores of the lake are seeing increasing numbers of visitors, fishermen and campers as summer houses are being built.

[8] The lake is accessible from the directions of Kaluđerske Bare and Perućac, by the curvy roads through the surrounding conifer forests.

The Jelisavčići bay, 20 m (66 ft) deep at the normal water level, drained to the point that it could be walked over on foot.

Landslide area spread to 30 ha (74 acres), crumbling and tilting 21 houses and destroying roads, communal infrastructure, meadows and forests.

[2][9][10][11] Despite all the evidence to the contrary, the state-owned electric utility power company Elektroprivreda Srbije (EPS) maintained that they are not emptying the lake and that situation is normal.

These lakes are also in the protected areas and the EPS claimed that everything was normal, while the local population accused them of forcing the electricity production and selling it on the black market.

National park departments estimated that the damage, both the material and environmental, especially for the fish life in the lake, is major.

There are over 600 plant species in the area surrounding the lake, of which 15 are protected by law, including the Serbian spruce and edelweiss.