The name is a modification of Tsill-anne, the Native American name for the lake, meaning deep water.
The town is a trading center and outlet for the Lake Chelan mining and fruit-growing region. Modern brick structures contrast with buildings on the wide main street. Water power, water transportation, fruit raising, lumbering, and mining are Chelan’s main industries, and the town also carries on a brisk tourist trade. Launches operate to Stehekin and Lucerne on Lake Chelan.
Chelan received wide attention from the press in 1936 when a pension plan was tested by locals. One thousand dollars in dollar bills were circulated, with the provision that a two-cent stamp should be attached each time a bill changed hands. The plan was abandoned after a period of trial.