The cave which houses Ruby Falls was formed with the formation of Lookout Mountain. About 200 to 240 million years ago (in the Carboniferous period, at the end of the Paleozoic era) the eastern Tennessee area was covered with a shallow sea, the sediments of which eventually formed limestone rock. About 200 million years ago, this area was uplifted and subsequent erosion has created the current topography. The limestone in which the cave is formed is still relatively horizontal, just as it was deposited when it was below sea level. The Lookout Mountain Caverns, which includes Ruby Falls Cave, is a limestone cave. These caves occur when slightly acidic groundwater enters subterranean streams and eats away at the relatively soluble limestone, causing narrow cracks to widen into passages and caves in a process called chemical weathering. The stream which makes up the Falls entered the cave sometime after its formation.
Ruby Falls Cave features many of the more well-known types of cave formations (or speleothems) including stalactites and stalagmites, columns, drapery, and flowstone.