The 1601 CE earthquake (Mw ca. 5.9) in “Unterwalden,” Central Switzerland, triggered multiple subaqueous mass movements and a subaerial rockfall that generated tsunami waves with run‐up heights of up to 4 m and several hundred meters of inundation along the coastal lowlands of Lake Lucerne. In the shallow Lucerne Bay, historical chronicles reported an oscillation of the water with an initial amplitude of ∼1–2 m and a period of 10 min, which continued for several days after the event with decreasing amplitude. Here, we investigate the lake‐tsunami process chain from subaqueous mass movement‐generated tsunami to wave propagation and ultimately to sediment resuspension, transport, and deposition in the shallow‐water environment. The effects of the historical tsunami on Lucerne Bay are reconstructed using sediment‐core analysis and numerical simulation of wave propagation. A 60‐cm‐thick event deposit was recovered along a sediment‐core transect in the shallow waters and radiocarbon dated to 1306–1442 cal CE. The event deposit has a sharp basal contact with carbonate shell fragments followed upwards a normally graded succession of siliciclastic sand to silt with a high proportion of horizontally bedded wooden particles. The numerically simulated tsunami waves are characterized by a water‐surface displacement of up to 1.5 m and generate bed shear‐stresses that are likely capable of remobilizing large amounts of sediments in the Lucerne Bay area. Our study successfully links the sedimentology of event deposits with physical principles of sediment mobilization derived from numerical wave‐forward modeling, providing a tool to improve the identification and interpretation of potential tsunami deposits.