Chambers Lake, at 9,300 feet above sea level in the Medicine Bow Range, is named for trapper Robert Chambers, who camped there with his son in 1858. One day while the son was away from the camp, Indians killed and scalped Chambers Sr. Nine years later in 1867, Robert Jr. told the Union Pacific Railroad about the timber available in the area for use as ties. The contractor and workers who set up camp there named the lake in honor of the trapper who had lost his life there.

In 1886, the Larimer County Ditch Company received a decree for water from Chambers Lake. The following year, they began enlarging its capacity by deepening the lake using horse-drawn slips and fresnos. They also constructed a ten-foot-high earthen dam on the east side of the lake. On June 8, 1891, the Chambers Lake dam broke, flooding downstream farms and destroying every bridge between the lake and Fort Collins. The flood also destroyed the community of Poudre City. Peak discharge estimated at 21,000 cfs. William Rist, the company engineer for Larimer County Ditch Company, had just inspected the dam that day. Property owners sued Larimer County Ditch Company, which dissolved and reformed as Water Supply and Storage Company on July 23, 1891.

Between 1891 and 1895, the Water Supply and Storage Company constructed Skyline Ditch from Laramie River to Chambers Lake. The first diversion of water from the Laramie River occurred in 1894, and the final length of the ditch was five miles. On May 20, 1904, heavy rainfall again caused the Cache la Poudre to flood. The new twelve-foot-high, log-reinforced replacement to the Chambers Lake dam gave way. Water Supply and Storage finally replaced the dam in 1910 with a 22-foot structure that included release gates and a concrete spillway. Starting in 1922, Water Supply and Storage began a project to raise the height of the Chambers Lake dam to 58 feet. Completed in 1928, this major undertaking is still in place today.[1. Stanley R. Case, <i>The Poudre: A Photo History</i> (Bellvue, CO: Stanley R. Case, 1995), 18-19, 214-220; Howard Ensign Evans and Mary Alice Evans, <i>Cache La Poudre: The Natural History of a Rocky Mountain River</i> (Niwot, CO: University Press of Colorado, 1991), 56-57; E. S. Nettleton, <i>The Reservoir System of the Cache La Poudre Valley</i> (Washington: Government Printing Office, 1901), 25; Ansel Watrous, <i>History of Larimer County Colorado</i> (The Old Army Press, 1911), 158, 163; <i>Fort Collins Express</i>, May 25, 1904; Norman Walter Fry, <i>Cache La Poudre: “The River” As Seen from 1889</i>, Second Printing, 21.]

he La Poudre: “The River” As Seen from 1889. Second Printing. pp. 21.