 The lake's name was the title of a popular 1990s song "Possum Kingdom" by The Toadies.The lake is home to Possum Kingdom State Park, a state park governed by the Texas Parks and Wildlife Department

The Possum Kingdom Lake area suffered major wildfires in 2011 during a severe drought, first in April with 160 homes destroyed and again in August–September with 39 homes and 9 recreational vehicles lost.The cause of the second 2011 fire was an electrical spark on the 101 Ranch The first week of August 2012 brought more wildfires to the PK vicinity (between the dam & Graford) which were possibly ignited by lightning strikes amid the extremely drought-ridden countryside.