There is a tradition that Star Lake is named for Harry Starr, killed by a pile driver. In various versions he was an employee of the mill or of the railroad. If the town were to have been named for him, he would have to have been killed in the process of building the original railroad to the town in 1894. The story is quaint mythology, but is simply not true. The death by pile driver of a man named Harry Stares was reported by the Minocqua Times of January 16, 1896.Times While it is certainly possible that the newspaper spelled Harry's name wrong, it is not possible that they confused a death in January 1896 with an event that would have to have happened two years earlier.
One of the best tellings of that story is contained in the Vilas County News-Review's 2012 Headwaters Area Guide, The Answer Book: "A place called Camp 1 got the name of Star Lake in memory of Harry Starr, who was killed while working on the construction of a railroad bridge across the mill hot pond. The lake was named Star, also."
However, it's just a good story. Maps of Wisconsin published in Milwaukee and Chicago beginning in the mid-1870's show "Star Lake" in its horseshoe shape. The earliest of these maps, found in the map collection of the Library of Congress, is "Chapman's New Sectional Map of Wisconsin, published by Silas Chapman, Milwaukee, Wisconsin, 1874." It was printed by "[J]. Knauber & Co. Steam Lithographic Printers, Milwaukee, Wis." I was unable to find any earlier map in the Library of Congress which showed Star Lake. This map names the following area lakes, in addition to Star: Plum, Laura, White Sand, Trout, St. Germain, and Arbor Vitae. Interestingly it clearly shows Irving, Ballard, White Birch, Partridge, Nixon, and Little Star, unnamed. It gets the drainage wrong, showing Ballard draining to Little Star. It shows Partridge draining into Nixon and on north. The original survey of the area was done in 1865. The notes to that survey do not show the name Star for the lake which is clearly identified on the survey. Nor are any of the other local lakes named in the survey (Trout Lake is). I have found no record of activity in Star Lake around 1870 which might have led to the naming of the lake. It is quite possible that a cartographer as far away as Chicago arbitrarily named the lake. The name of the railroad station and town clearly were based on the previously named lake.
There are three extant spellings of the name: Star Lake, Starlake, and Starr Lake. The first is most commonly used by everyone today, and it has always been so. For some, now lost, reason the Post Office decided to make it one word. A review of early post office department correspondence in the national archives shows that while the bureaucrats in Washington, and the Postmaster in Starlake, wrote "Starlake," postmasters in neighboring towns nearly always wrote "Star Lake". The Star Lake Post Office was frequently mentioned in such correspondence because Star Lake was the railhead, and thus the source of mail for many surrounding areas.
The only use of "Starr Lake" of which I am aware is on an old letterhead from "House of the Good Shepard on Ballard Lake, Vilas Co. Wis.", E. S. Shepard proprietor, dated 1900. Since there is a very strong tradition that the Harry killed by the pile driver was Harry Starr and not Harry Stares, the use of "Starr Lake" by Shepard suggests that he may have been honoring the idea of naming the town for Harry Starr. If that is true, that makes the origin of the naming story extremely early. It does not, however, make it true, since the dates simply don't fit the known facts.
Note that the Bibliography file accessed by the tab above is uniquely ordered for this topic. The major references are various items relating to the naming of the lake, excluding those that tell the Harry Starr myth. The minor references are those that perpetuate the myth.
Update, 2005. This spring I visited the Postal Service Zip Code lookup on the Web. When I searched for the town associated with 54561 it lists "Star Lake" and says that "Starlake" is unacceptable. I have written to USPS to ask when the official change occurred and why. I have not as yet received an answer.