According to the U.S. Forest Service, the origin of the name "Tahoe" has some controversy, however it is probably based on the Washoe Tribe's term, "Da ow ga", or simply "the lake."  Early Euro-Americans heard the Washoe pronunciation, and the variation "Tahoe" was soon applied.  The Washoe were the first people to inhabit the Lake Tahoe region. 

In 1845, the California State Legislature officially renamed "Lake Bigler" with its present name, "Lake Tahoe."  Bigler was the third California Governor.  In 1870, the lake was officially referred to as "Lake Tahoe."

The then fledgling correspondent Mark Twain, connected with Virginia City's "Territorial Enterprise" ... commented that 'Ta-hoe', in the dialect of the Digger and 'Pi-ute' (sic) tribes meant 'grasshopper soup', which, he contended, was among their delicacies.  This is possibly the most colorful "explanation" for Lake Tahoe's name we could find.