In the late nineteenth century, Guild's Lake was home to a number of Chinese immigrants, who had small houses and vegetable gardens on the edge of the marsh. Like other Chinese people in the Pacific Northwest, they often faced harassment and racism.

The earliest Chinese settlers came to Oregon in 1851 when gold was discovered in southern Oregon, and regular steamer connection between Portland and San Francisco was established. After the gold rush, Chinese workers came to Oregon to fill the labor shortage in railroad construction.

By 1868, when the Burlington Treaty, guaranteeing free entrance and equal treatment for Chinese nationals was signed, several ships began bringing passengers to Portland directly from Hong Kong. After the completion of major railroad construction in the 1880s, many Chinese former railroad workers moved to Portland. In 1890, ten percent of the city's population was Chinese.

While Chinese immigrants built much of Oregon's transportation infrastructure, many white Oregonians did not welcome their continued presence. An 1886 editorial in the Oregonian suggested that Portland's Chinese residents should move to less prominent sections of town. Labor groups blamed Chinese workers for low wages and high unemployment. During the mid 1880s, anti-Chinese sentiment peaked throughout the West. In Seattle and Tacoma, mobs forced Chinese residents to board ships bound for San Francisco and Portland. While Portland citizens never outright forced them to leave, vigilante mobs did attack Chinese immigrants.

On March 13, 1886, the Oregonian reported that members of the "Ku Klux Klan," who were identified as residents of "Slabtown," had harassed the Chinese inhabitants around Guild's Lake. Slabtown was the name of a working-class section of NW Portland between Guild's Lake and the present Pearl District. A mob ransacked Chinese homes and farms, burning down thirty houses. "They then came on ...another ranch, where they turned out five more men. Here they found one man who had a pistol, so they tied his hands before searching him and fired some thirty or forty pistol shots to terrify their victims." The Oregonian also reported that the "ruffians" invaded homes, stole items, and forced their victims to walk toward the city.