(from site) In 1887, a project was adopted to improve the harbor at Agate Bay by constructing breakwaters from the eastern and western points at the entrance. At that time, Agate Bay, also known as Two Harbors, had two elevated iron ore docks, and two merchandise docks.

1887 Map of Agate Bay showing proposed breakwaters.
Two Harbors Lighthouse commenced operation on the eastern side of Agate Bay in 1892, and on December 14, 1895 a white, eight-day lantern light, shown from an iron post at an elevation of thirty feet above lake level, was established on the outer end of the eastern breakwater that extended from the shore near the lighthouse. In 1902, after the work on the breakwaters had been completed the previous November, the iron post was moved 300 feet from the angle of the pier to the outer end of the newly constructed ell, where the light was changed from a lens-lantern to a Pintsch gas light. Compartments were constructed in the breakwater to hold two eight-foot-long, cylindrical gas tanks, which were connected via pipes to the iron post supporting the light. The new gas light was first exhibited on September 10, 1902. Four years later, the post light was replaced by an enclosed light tower, described in the Annual Report of the Lighthouse Board:

The 1906 lighthouse remains in service today, exhibiting a red flash every six seconds. The 1,500-pound fog bell has been replaced by a horn that can be activated by keying a microphone five times on VHF-FM Channel 79.