Nestled in the valley of the Cottonwood River, Marion Reservoir takes its name from both the community and county of Marion. The town, once called Marion Center, was named for General Francis Marion, the "Swamp Fox" of the American Revolution. The first settlement was made in this thriving agricultural area in 1860. The town was first platted in 1866 and incorporated in 1875. It is noted for its stone buildings and beautiful park. The nearby community of Hillsboro has an interesting history linked to the Mennonite pioneers who introduced red winter wheat in Kansas. The Marion County Historical Museum in Marion and the Pioneer Adobe House Museum in Hillsboro display early day artifacts of the area.

Located at the western edge of the Flint Hills, and the eastern edge of the Western Plains, this area was a center of cross-country travel even in pioneer days. The old Santa Fe Trail crossed the northern portion of Marion County from east to west. The Chisholm Trail of 1870 crossed the county from south to north. The Kaw Indian Trail crossed the county from northeast to southwest. The historic Cottonwood Crossing of the Santa Fe Trail was located in the northwestern part of the county near Durham. This crossing was one of the most notable camping sites on the trail. Though barely visible through the grass and prairie flowers, ruts of the old Santa Fe Trail may still be seen.

Marion Reservoir was authorized by the Flood Control Act of 1950.  The project was designed and built under the supervision of the Tulsa District, Corps of Engineers at a cost of $13,600,000.  Construction began in March 1964, and the project was placed in full flood control operation in February 1968.  The lake is one of three projects constructed for flood management and low-flow regulation for the upper Grand (Neosho) River Valley. The other projects are John Redmond Dam and Reservoir and Council Grove Lake.