The area around Shark Lake was set aside as a common reserve in 1898, being a stopping place on the route from Esperance to the Dundas goldfields. Located on the Norseman to Esperance railway, a siding was opened at Shark Lake in 1955. The townsite was gazetted in 1967 and named after the nearby lake but it is not known why a freshwater lake would be referred to as Shark Lake.[3]
The townsite spreads over two localities, with the western part being in Monjingup and the eastern part in Myrup, the highway forming the boundary between the two. The Monjingup part of the townsite is larger than the Myrup one.[2]