The Shoalwater Bay Reservation was established on the site of an ancient Lower Chehalis village, a place that had a strong Chinook heritage as well, called Namscac. When longtime indigenous leaders and residents of Namscac, and the allied community of Bay Center strongly resisted removal, President Andrew Johnson signed an executive order setting a small parcel of beachfront property along the Bay from settler occupation.

From September 22, 1866 presidential order until 1876 reserve lands at Shoalwater Bay were all but forgotten by government officials and tribal residents began to question if it was actually set aside. In 1876 after a new Superintendent of Indian Affairs uncovered evidence for the executive order and established formal ties to Reservation leaders, traveling to Shoalwater Bay to make the agreement with the Namscac Tyee.