Algonquin State Forest began as 92 acres in 1937, and has grown to a size of 2,545 acres today. The forest consists of several parcels in the towns of Colebrook and Winchester. The largest piece of the forest is along Sandy Brook in Colebrook. Most of the early acquisitions of Algonquin State Forest were gifts to the State. The name 'Algonquin' is an Indian name.

The forest is managed for sawtimber, firewood, wildlife habitat, and recreational activities such as hiking, hunting, fishing, and bird watching.