The town's main features are Potlatch State Park and the Cushman Dam No. 2 powerhouse, which generates hydropower electricity for Tacoma. Water from Lake Kokanee on the North Fork Skokomish River is piped to the powerhouse at Potlatch. Nearly the entire flow of the river was diverted to the Potlatch Powerhouse. A 2009 settlement will result in more water from the Cushman Hydro Project, which includes Cushman Dam No. 1 at Lake Cushman, and Dam No. 2 at Lake Kokanee, being released into the lower North Fork Skokomish River.
The town's history dates to 1900, when Thomas Bordeaux became president of the newly incorporated Potlatch Commercial and Terminal Company. The company acquired timber lands and began construction of a logging railway to access them. Potlatch was built as a company town. The hydroelectric dam at Lake Cushman and the Potlatch Powerhouse began producing electricity in 1926. The second dam at Lake Kokanee was finished in 1930. The water is conveyed to Potlatch through huge pipes, visible for miles.
- "Potlatch". Geographic Names Information System. United States Geological Survey.
- "Skokomish River Basin" (PDF). USGS. Retrieved 2009-07-13.
- "Cushman Hydro Project". Tacoma Power. Retrieved 2009-07-13.
- Kirk, Ruth; Carmela Alexander (1990). Exploring Washington's Past: A Road Guide to History. University of Washington Press. p. 508. ISBN 0-295-97443-5.
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