The lake was the site of the former Jackson County Iron Mine quarry. The mine was in operation from the early sixties until April of 1983. Approximately 850,00 tons of iron-rich taconite pellets were produced at the mine each year, with the bulk of them used for steel production in mills located in East Chicago, Indiana. A crash of the domestic steel markets in the United States contributed to the decision to close the mine.
 
While the mine was actively producing ore, several high capacity pumps expelled more than 800 gallons of water per minute from the quarry. Once the pumps were removed, the quarry began filling and formed this unique lake.
 
Today, Wazee Lake is recognized as the deepest inland lake in the State of Wisconsin with a maximum depth of 355 feet. Visibility in the lake averages 30-40 feet during the summer months. Water temperatures run from approximately 70 degrees surface temperatures to 40 degrees below the thermocline. The thermocline depth varies during summer, but averages about 30 feet. Divers who venture to greater depths will encounter a second thermocline at approximately 60 feet where the temperature drops to a chilly 34 degrees. Use of a quality dry suit (with proper training) is recommended for deep diving in the lake. Although all machinery was removed from the quarry upon its closure, remnants of the mining operation still remain visible underwater. A series of circular haul roads wind around the pit, where divers often find artifacts including chains, pipes; taconite pellets, and iron shovel teeth. Massive boulders and shear cliff faces create challenging and interesting features for the more experienced recreational diver. Novice divers will enjoy the gradually descending roadways, which are found throughout the quarry. Divers may encounter several groups of fish cribs as well as four platforms used by instructors for training new divers. These were added to the site to increase the diver's enjoyment, and to improve the habitat for the various fish species that are found in the lake. These species include rainbow, brook and brown trout, bluegills, suckers, catfish, and small mouth bass.

Other activities exist on site for additional recreational enjoyment. Many miles of hiking and gravel surfaced bicycle trails wind through a mosaic of prairie and forests. Several scenic overlooks are currently under construction as well as improved picnic and sanitary facilities. Construction of a large beach and boat launch complex was completed in 1996. Dive fees are $5.00/day for each individual diver using the lake, or $40.00/calendar year for each diver. Dive fees are required all year. Admission fees are also required which are $5.00/vehicle/day or $30.00/vehicle/year. Admission fees are required all year. Fees can be paid at the contact station between Memorial Day and Labor Day, or divers, campers and vehicles can self-register at the contact station in the absence of a park attendant.
 
Use of a dive flag is mandatory and is enforced by local law enforcement.

https://www.co.jackson.wi.us/index.asp?SEC=725638CD-7569-4914-BDCB-E61BC8C2707D