The lake fills the basin of the upper Peace River, backing into the Rocky Mountain Trench which is where the Parsnip and Finlay met at Finlay Forks to form the Peace. The lake includes three reaches, the Peace Reach (formerly the Peace Canyon), and the Parsnip and Finlay Reaches, which are the lowermost basins of those rivers, and covers a total area of , being the largest lake in British Columbia and the seventh largest reservoir in the world.