After fur traders entered the Portage Lake region, a few lumbermen arrived seeking saw-mill sites, and in 1840 Joseph Stronach built a dam and water mill on the swift natural outlet of Portage Lake. Homesteaders soon followed and cleared surrounding land for farms, but annual flooding caused by water needed to run the mill frustrated them, and the slow pace of court action against the mill owners led the settlers to dig by hand a four foot wide cut between the two lakes. On May 14, 1871, water from Portage Lake rushed out, carving a channel five hundred feet wide and carrying large trees far into Lake Michigan. When the two lakes were leveled, a fine new harbor of refuge was created, accessible through the new channel. Later, in 1879, after available timber had been depleted, the mill and its holdings were moved to a more desirable location on the east end of the lake, establishing the village of Onekama. Many meanings have been offered for the Indian word O-NEK-AMA-ENGK, including place of great beauty, place of contemplation, to carry on the shoulder, and to portage or carry across. Indigenous people had to portage their canoes around the narrow, swift rapids of the natural outlet to travel from Lake Michigan into Portage Lake. After the cut was made, the natural outlet and the original saw-mill site were left about eight feet above Portage Lake.