Big Bay was founded as a company-built sawmill town, tucked between the Huron Mountains and Lake Superior. In 1943 after a brief recession the mill was bought and reopened by Henry Ford. Like many other of Henry Ford's model towns it was pretty but unprofitable and soon closed. Big Bay is neighbored by the Huron Mountain Club, a vast fenced off fishing and hunting retreat and wilderness area owned by extremely wealthy families, most of whom made their money in the 19th century, including the Ford family. Big Bay is most famously known for being the location of both the book and the movie of Anatomy of a Murder.

Big Bay is also the western trailhead of the Hiawatha Water Trail, and near unusual Jacobsville sandstone formations under the waters of Lake Superior that rise up to become cliffs.