Lake Shikaribetsu is the only natural lake in Daisetsuzan National Park, and at 810 meters above sea level, it is the highest lake in Hokkaido, with its deepest point at about 100 meters. The lake is surrounded by virgin forest (Abies sachalinensis, Ezo spruce, and downy birch), which preserves its prehistoric nature.

The lake is a "dammed lake" formed when a river was dammed by an eruption about 30,000 years ago, and has a circumference of about 13 km. Nine bays are formed along the complicated shoreline, and Benten Island floats to the north of the lake. Mt. Temmo-zan, located to the east of the lake, is called Kuchibiru-yama (Mt. Lip) because of its shape and the shadow it casts on the lake's surface, and has become the symbol of Lake Shikaribetsu.

The surrounding area is home to a variety of precious wildlife, including the "pacific egret," a living fossil said to have inhabited the area since the Ice Age, ospreys, white-tailed eagles, black woodpeckers, and great blue herons.