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Red Hills State Park is at an important historical crossroad, the westernmost edge of the first land in Illinois ceded by Native Americans to the United States. The borderline runs through the park from southwest to northeast, and was set by a treaty made in 1795 at Greenville, Ohio, by General Anthony Wayne whereby Native Americans relinquished all claims to the land northwest of the Ohio River and east of a specified line. The area was called Vincennes Tract.

The area was bisected by the Old Cahokia Trace, commonly known as the "Trace Road," which ran east and west just north of what is now U.S. Rt. 50, and was for many years the principal route from historic Vincennes to St. Louis and the west.

A dam constructed across Muddy Creek, a tributary of the Embarras (pronounced "Ambraw") River in 1953, created the 40-acre Red Hills Lake, which has a maximum depth of 30 feet and 2.5 miles of shoreline.