Madison Lake is a small city in Blue Earth County, Minnesota, United States. The city takes its name from nearby Madison Lake, and is loc…Madison Lake is a small city in Blue Earth County, Minnesota, United States. The city takes its name from nearby Madison Lake, and is located adjacent to the northwest shore of the lake. The population was 1,247 at the 2020 census. It is part of the Mankato-North Mankato Metropolitan Statistical Area.