In the late 1800's a lot of bathing resorts started dotting the shores of the Great Salt Lake. One of these resorts was known as Lake Park which opened in 1886. At the time it was known as "one of the most attractive watering places in the West". It featured dancing, swimming, boating, bowling, target shooting, roller skating, and a mule-drawn Merry-go-round. At the end of it's first year 53,000 people had visited the resort.

In 1893 the waters of the Great Salt Lake began to recede leaving the resort next to sticky mud and far from water. The resort continued to operate under these conditions focusing on other activities that visitor's could do. It was during this time that the Vice President of Lake park, Simon Bamberger - who held a 25% interest in the resort, started exploring options for his own resort.

Bamberger had been building a railroad to connect Salt Lake City with Ogden. 2.5 miles to the east of Lake park and near his railroad was a small 9-acre lagoon. Bamberger was a very smart businessman and knew people would ride his railroad if he built a resort right next to it. He decided to go forward with those plans and bought some of the original Lake Park buildings. He then relocated them to the lagoon and opened his resort in 1896. One of these buildings was the dancing pavilion designed by Richard Kletting, who is best known as the architect of the original Saltair and the Utah Capitol Building.

The name "Lagoon" was chosen to suit the the resort's home on the banks of the 9-acre lagoon. When Lagoon opened it advertised "Bowling, Elegant Dancing Pavilion, Fine Music, A Shady Bowery, and Good Restaurants." The Bamberger railway brought the crowds to enjoy Lagoon for only 25 cents.

Shortly after Lagoon's opening additional attractions were added. Some were typical of those found at other amusement parks around the country. The first "thrill ride" to grace the park was the "Shoot the Chutes" in 1899. This ride was a distant cousin of the log flume ride. And a year later swimming in the lake started. A merry-go-round was installed in 1906 and is still used today by the park.