The entire area is situated in what was the Kankakee Grand Marsh, which once covered hundreds of thousands of acres. Most of the Marsh was drained in the late 1800s for agricultural use.

In 1927, the state purchased 2,312 acres of the remaining marsh for a Civilian Conservation Corp. camp, housing as many as 400 men. The area later became established as a game preserve, and during the 50s, waterfowl management was undertaken by the state. In 1982 another 1,016 acres were added and in 1992 an additional 767 acres.

Most revenues used in land acquisition, development, operation and maintenance of Kankakee Fish and Wildlife Area are derived from the sale of hunting, fishing and trapping licenses. Funds are also received from the federal Pittman-Robertson and Dingell-Johnson programs to aid fish and wildlife restoration. These funds are derived from taxes levied on sport hunting and fishing equipment. Indiana hunters and fishermen are proud to provide this property for the enjoyment of all people.