James Lagoon is a drowned cirque basin about 0.5 miles (0.8 km) wide, partially enclosed by the remains of a terminal moraine, on the western shore of McCarty Fjord in Kenai Fjords National Park, about 51 miles (82 km) southwest of Seward and 40 miles (64 km) east-southeast of Homer, Alaska. The lagoon was named by Ulysses S. Grant and Daniel F. Higgins of the US Geological Survey for Captain James J. Bettles, a resident of Valdez, Alaska, who assisted in mineral surveys in Southcentral Alaska in 1909. At that time, the terminus of the McCarty Glacier lay adjacent to the lagoon. The estuary is fed by two glacial streams. The eastern stream begins at the terminus of an unnamed glacier at an elevation of about 1,300 feet (396 m) and flows generally south for 3 miles (4.8 km) to the lagoon. The eastern glacier starts at about 3,300 feet (1,006 m) in the Kenai Mountains and flows south-southwest for 2.5 miles (4 km). The western stream begins at another small unnamed glacier at an elevation of about 1,350 feet (412 m) and flows generally southeast for 3 miles (4.8 km). The western glacier starts at about 4,000 feet (1,220 m) and flows south-southwest for 3.7 miles (5.9 km). The Kenai Mountains in this vicinity belong to the Southern Margin composite terrane, and the rocks represent the Valdez Group that developed during the Late Cretaceous. They consist primarily of complexly deformed metasedimentary greywacke, siltstone and shale, generally regarded as deposits of turbidity currents in an oceanic trench.

Glaciers are a major influence on the present-day morphology of the southern Kenai Peninsula. During the Last Glacial Period, glaciers and ice fields covered the peninsula and likely extended to the edge of the continental shelf, about 138 miles (220 km) offshore from the current coastline. They retreated from about 11,000 to 6,000 years ago during the Early and Middle Holocene, then expanded in the Neoglacial period (about 4,000 to 1,100 years ago) and retreated again between 1,100 and 700 years ago. During the Little Ice Age (between 16th and late 19th centuries), the most recent glacial advance progressed seaward in the Kenai Fjords region, including McCarty Glacier, propelled by snow accumulation on the higher elevations of the Harding Icefield. McCarty Glacier underwent a drastic retreat shortly after 19 09, reaching shallow water at its head around 19 60. McCarty Fjord is now a 22-mile (35 km) waterway, 1 to 2 miles (1.6 to 3.2 km) wide, deeply scoured and partly enclosed by a terminal-moraine shoal spanning the fjord between James Lagoon to the west and McCarty Lagoon to the east. Formerly filled by McCarty Glacier, the fjord began to open up when the glacier underwent a drastic retreat shortly after 1909, reaching shallow water at its head around 1960. In 1964 the Great Alaska Earthquake caused subsidence of 0.3 to 0.7 feet (1.0 to 2.5 m) along the Kenai Fjords coastline. As a result of landslides, widespread flooding and saltwater incursion into once-forested areas, ‘ghost forests’ of dead standing trees now occupy low-lying places such as James Lagoon.

The outer coast of the Kenai Peninsula is the traditional territory of the Unegkurmiut, a distinct group of the Chugach Alutiiq. The first European contact with the Unegkurmiut likely occurred in the late 1780s, when Russian fur traders arrived. In the 1830s a trading post and a Russian Orthodox chapel were established at Yalik village, near the entrance to McCarty Fjord. From its formation in the late 18th century, the Russian-American Company discouraged Russians from settling in Alaska but permitted its employees to have children with Alaska Natives. The resulting mixed-heritage, or Creole, population grew from some 200 people in 1818 to nearly 2,000 in 1863, benefiting the Russians in their struggle to recruit company workers. When Alaska was purchased by the United States in 1867, Creoles made up the majority of the skilled workforce of the Russian-American Company. Most had been moved by the Russian Orthodox Church from the outer coast to the present-day villages of Nanwalek and Port Graham. Prospectors staked several claims near the entrance to McCarty Fjord, and a homestead was developed on nearby Nuka Island. Between 1920 and 1925, McCarty Glacier retreated enough to expose Delight Lake on the eastern shore; between 1935 and 1940, Desire Lake emerged to the north. In 1949 the first sockeye salmon were caught and sold commercially in this area. King crabs were harvested in the 1960s, and Dungeness crabs were taken from James Lagoon, where crab pots were also stored. Topographic maps from the 1950s show a cabin in James Lagoon, but nothing remains of it. It may have been a casualty of the 1964 earthquake. Read more here and here. Explore more of James Lagoon and McCarty Fjord here: