Ice-dammed Hidden Creek Lake, Alaska, USA, outbursts annually in about 2-3 days. As the lake fills, a wedge of water penetrates beneath the glacier, and the surface of this 'ice dam' rises; the surface then falls as the lake drains. Detailed optical surveying of the glacier near the lake allows characterization of ice-dam deformation. Surface uplift rate is close to the rate of lake-level rise within about 400 m of the lake, then decreases by 90% over about 100 m. Such a steep gradient in uplift rate cannot be explained in terms of ice-dam flexure. Moreover, survey targets spanning the zone of steep uplift gradient move relative to one another in a nearly reversible fashion as the lake fills and drains. Evidently, the zone of steep uplift gradient is a fault zone, with the faults penetrating the entire thickness of the ice dam. Fault motion is in a reverse sense as the lake fills, but in a normal sense as the lake drains. As the overall fault pattern is the same from year to year, even though ice is lost by calving, the faults must be regularly regenerated, probably by linkage of surface and bottom crevasses as ice is advected toward the lake basin.